According to a recent report by The Information, Morgan Stanley, one of the world’s largest asset managers, is considering adding cryptocurrency trading to its E-Trade online brokerage platform. This move would make E-Trade one of the biggest traditional retail brokerages to support crypto trading, potentially creating meaningful competition for incumbent platforms like Coinbase.
Background on Morgan Stanley and E-Trade
Morgan Stanley acquired E-Trade in 2020. The brokerage’s 5.2 million accounts collectively hold approximately $360 billion, according to The Information. This significant user base would be a major factor in the potential success of crypto trading on the platform.
Regulatory Environment Under Donald Trump
The report cites expectations of a friendlier crypto regulatory environment under United States President-elect Donald Trump as a key consideration for Morgan Stanley’s decision. Trump has promised to appoint industry-friendly leaders to key regulatory agencies and make the US "the world’s crypto capital." This shift in regulatory stance would likely create an environment more conducive to cryptocurrency adoption.
Crypto Trading on E-Trade: A Game-Changer?
The addition of crypto trading on E-Trade could bring cryptocurrency to millions of investors, creating a significant impact on the market. According to a report by The Information, available tokens on these platforms are generally more limited than on crypto-native centralized exchanges like Coinbase.
Brokerages Embracing Crypto Trading
Other traditional retail brokerages offering crypto trading include Robinhood, Fidelity, and Interactive Brokers. Charles Schwab reportedly plans to add crypto trading this year, according to Bloomberg. These moves indicate a growing trend among traditional brokerages to adopt cryptocurrency trading services.
Crypto Trading Volumes Soar for Online Brokerages
Crypto trading has been a lucrative business for online brokerages. Robinhood’s Q3 2024 results show that crypto trading volume and revenue soared 112% and 165% year-on-year, coming to $14.4 billion and $61 million, respectively. Meanwhile, incumbent Coinbase clocked revenues of $1.2 billion in the third quarter of 2024, primarily from its crypto trading businesses.
Morgan Stanley’s Early Mover Advantage
Morgan Stanley has been an early mover in crypto compared with other traditional wealth managers. In August, Morgan Stanley authorized its 15,000 financial advisors to start recommending Bitcoin (BTC) exchange-traded funds to clients. This move demonstrates the firm’s commitment to cryptocurrency adoption and positions them as a leader in this space.
Morgan Stanley Advisers Recommend Blue-Chip Funds
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 widely considered "blue chips" among Bitcoin exchange-traded funds.
The Future of Crypto Trading on E-Trade
While the addition of crypto trading to E-Trade is still in consideration, it would undoubtedly create a significant impact on the market. As more traditional brokerages adopt cryptocurrency trading services, the industry is likely to see increased competition and innovation.
Related Articles:
- 2025 Will Be Crypto’s Best Year Ever — Steno Research
- Brokerages Embrace Crypto
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