Morgan Stanley, one of the world’s largest asset managers, is considering adding cryptocurrency trading to its E-Trade online brokerage platform, according to a Jan. 2 report by The Information.
The wealth manager reportedly cited expectations of a friendlier crypto regulatory environment under United States President-elect Donald Trump as a key consideration.
Trump has promised to appoint industry-friendly leaders to key regulatory agencies and make the US “the world’s crypto capital.”
The plans would make E-Trade one of the biggest traditional retail brokerages to add support for crypto trading, potentially creating meaningful competition for incumbent platforms, such as Coinbase.
Morgan Stanley bought E-Trade in 2020. The brokerage’s 5.2 million accounts collectively hold approximately $360 billion, the Information said.
E-Trade could bring crypto to millions of investors. Source: E-Trade
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Brokerages embrace crypto
Other traditional retail brokerages offering crypto trading include Robinhood, Fidelity, and Interactive Brokers. Charles Schwab reportedly also plans to add crypto trading this year, according to Bloomberg.
Available tokens on these platforms are generally more limited than on crypto-native centralized exchanges such as Coinbase.
Crypto trading has been a lucrative business for online brokerages. Robinhood’s Q3 2024 results show that crypto trading volume and crypto revenue soared 112% and 165% year-on-year, coming to $14.4 billion and $61 million, respectively.
In June, Robinhood agreed to acquire the Bitstamp crypto exchange in a $200 million deal that would enable it to serve institutional investors in the United States.
Meanwhile, incumbent Coinbase clocked revenues of $1.2 billion in the third quarter of 2024, primarily from its crypto trading businesses.
Early mover
Morgan Stanley has been an earlier mover in crypto compared to other traditional wealth managers.
In August, Morgan Stanley authorized its 15,000 financial advisers to start recommending Bitcoin (BTC) exchange-traded funds (ETFs) to clients, a person familiar with the matter told Cointelegraph.
As one of the largest wealth managers in the US, Morgan Stanley’s advisory network manages some $3.75 trillion, including $1 trillion in self-directed client accounts.
Morgan Stanley advisers have been recommending BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity’s Wise Origin Bitcoin Fund (FBTC), both of which are considered “blue chips” among Bitcoin exchange-traded funds.
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