Morgan Stanley wants to expand its digital asset offerings, including a native custody and exchange solution for crypto, the firm said during a conversation at Strategy World.
Phong Le, President and CEO of Strategy, spoke with Amy Oldenburg, Head of Digital Asset Strategy at Morgan Stanley, about the firm’s upcoming products.
Morgan Stanley will first allow clients on its E-Trade platform to buy and sell spot cryptocurrencies through a partnership. Last year, the bank said it was pursuing a spot Bitcoin ETF and planning to enable direct trading for clients via E*Trade.
Over the next year, the bank intends to develop a fully integrated custody and exchange platform.
“This is a natural progression,” the executive said. “We can’t just primarily rent the technology to do this. People expect Morgan Stanley – they trust our brand – to be no fail.
Morgan Stanley’s custody option for clients
The planned solution would give clients legal custody of their digital assets under Morgan Stanley’s oversight. The firm acknowledged that some clients will continue to prefer self-custody, particularly in Bitcoin.
Oldenburg outlined their experience in emerging markets as a driver for the firm’s approach to digital assets.
Over 26 years at Morgan Stanley, including 13 years running the firm’s emerging market investing business, Oldenburg has observed early adoption of Bitcoin and other cryptocurrencies in 17 of the top 20 markets globally.
“As this space continues to institutionalize, we aim to provide comprehensive services to our clients,” Oldenburg said.
The bank is also exploring additional services, including yield and lending products against crypto holdings.
“It’s a natural part of the roadmap to continue to explore,” the executive said. She said they are in the early stages but are tracking momentum in decentralized finance lending and other crypto products.
Oldenburg noted that the bank manages $8 trillion in assets on its platform, and a significant portion of clients currently hold crypto off-platform.
Bringing those assets onto the platform would allow the firm to offer custody, trading, and potential yield or lending services.
No specific timeline was announced for the launch of yield or lending products, though the firm indicated these would follow the rollout of the custody and exchange platform.
At the time of writing, Bitcoin is up 8% on the day and trading near $69,000. Other related equities and crypto are up as well.