Morgan Stanley considers adding crypto to E-Trade platform

Morgan Stanley is reportedly exploring the integration of cryptocurrency trading into its E-Trade online brokerage platform, according to a January 2 report from The Information.

This move aligns with expectations of a more favorable regulatory environment for digital assets under President-elect Donald Trump’s administration.

Trump has pledged to position the United States as a global leader in cryptocurrency by appointing industry-friendly regulators to key agencies.

If implemented, E-Trade would join the ranks of traditional brokerages like Robinhood, Fidelity, and Interactive Brokers that already offer crypto trading services.

E-Trade, acquired by Morgan Stanley in 2020, oversees approximately $360 billion in assets across 5.2 million accounts.

Adding cryptocurrency services could make E-Trade a formidable competitor to platforms like Coinbase.

Crypto trading has proven highly profitable for online brokerages.

Robinhood, for example, reported a 112% year-over-year increase in crypto trading volume during Q3 2024, reaching $14.4 billion, alongside a 165% surge in crypto-related revenue.

Its acquisition of Bitstamp for $200 million in June further demonstrated its commitment to expanding crypto offerings.

Morgan Stanley has also been proactive in embracing cryptocurrency.

In August 2024, it allowed its 15,000 financial advisers to recommend Bitcoin (CRYPTO:BTC) exchange-traded funds to clients.

These advisers, managing $3.75 trillion in assets (including $1 trillion in self-directed accounts), have endorsed funds like BlackRock’s iShares Bitcoin Trust and Fidelity’s Wise Origin Bitcoin Fund.

If Morgan Stanley integrates cryptocurrency trading into E-Trade, it could significantly expand access to digital assets for retail investors while intensifying competition in the evolving crypto market.

However, the scope and timeline of such an initiative remain uncertain.