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Morgan Stanley is considering a move to offer cryptocurrency trading to customers on its ETrade platform, as US banks prepare for lighter regulation of digital assets under the Trump administration.
The bank’s deliberations are at an early stage and may include a partnership with a trading firm that is already active in crypto, according to a person familiar with the matter.
They come as President Donald Trump has taken a much friendlier approach to crypto than his predecessor Joe Biden. The Securities and Exchange Commission has backed away from cases against major crypto firms, and the Justice Department has said it will scale back enforcement in digital asset cases.
Trump and his family have also engaged in several crypto projects, including rival coins backed by the president and first lady, Melania Trump.
So far this year, the Federal Reserve, Office of the Comptroller of the currency and the Federal Deposit Insurance Corporation — the three principal US bank regulators — have all withdrawn prior guidance to banks requiring them to give advance notice of any activities related to crypto assets.
ETrade is Morgan Stanley’s retail trading arm, which the Wall Street bank acquired in 2020 for $13bn. Its clientele has skewed younger than the bank’s historical roster of clients of large institutions and wealthy older individuals.
Cryptocurrencies, and bitcoin in particular, have been a thorny issue for Wall Street banks.
Regulators, especially under the Biden administration, took a restrictive approach in allowing banks they oversee to engage with volatile and loosely regulated digital assets. Bank executives themselves have also taken a sceptical view — most notably JPMorgan Chase chief executive Jamie Dimon, who has said bitcoin “does nothing” and compared it to a pet rock.
But many bankers regularly face questions from clients about trading cryptocurrencies, and they have expressed willingness to offer the service if regulators allow it.
Bank of America boss Brian Moynihan told CNBC earlier this year that “the banking system will come in hard on the transactional side” of cryptocurrencies if rules permitted it.
Morgan Stanley declined to comment. The lender’s deliberations were reported earlier by Bloomberg.