Wall Street banking giant Morgan Stanley could soon introduce spot crypto trading to its clients using its ETrade platform.
According to a Bloomberg report citing sources familiar with the matter, the discussions are in top gear within the bank, with executives planning to launch spot crypto trading sometime in 2026. The report states that the bank may be “considering partnering with one or multiple established crypto firms” to find the best methods for adding trading to the platform.
American Banks Can Now Engage In Crypto
The plan to introduce spot crypto trading comes as the Donald Trump regime is making numerous regulatory changes to elevate the place of cryptocurrencies within the American financial system.
The latest of these moves is Thursday’s removal of two supervisory letters by the Federal Reserve that had discouraged banks from dealing with any crypto-related issues. With the new development, American banks can engage in crypto-related activities without notifying the FED, which will be reviewed using regular supervisory procedures.
Sources familiar with the plan to integrate crypto activities with the E*Trade platform say it gained momentum as soon as Donald Trump won the presidency in November 2024. With the Trump 2.0 administration taking deliberate steps to reverse numerous adverse crypto regulations, several financial institutions are reportedly reconsidering their approach to the emerging crypto sector.
If Morgan Stanley succeeds with its plans, it will create new pressure for pioneer crypto firms like Kraken and Coinbase, which currently serve most of the American retail cryptocurrency market.
Changes within the US Crypto Regulatory Framework
Apart from Morgan Stanley’s plan to delve into spot crypto trading, other firms like Charles Schwab and SoFi have shown plans to enter the crypto sector because of fundamental changes within the US crypto regulatory framework.
However, the success or otherwise of the plan to integrate crypto trading with the E*Trade platform will depend on what partnerships the bank will engage in. Moreover, market players believe the move could introduce a new level of competition for incumbents like Coinbase and Robinhood Markets.
Big banks and financial institutions deliberately avoided the crypto sector for a long time, eying it with suspicion even as digital assets steadily gained popularity over the last decade. During that period, any suggestions to assist crypto clients and companies raised serious, thorny issues on how their customers would guard assets that had been prone to scams and attacks for a long time. Even federal regulators went as far as to dissuade banks from accepting cash deposits from high-flying crypto ventures.
Conclusion
Suppose Morgan Stanley succeeds in finally introducing spot crypto trading on its E*Trade platform. In that case, it will have joined the ranks of banks such as JPMorgan Chase, whose CEO James Dimon had called Bitcoin “worthless,” “a fraud,” and a “pet rock” but has since seen that light and said last year that “I defend your right to do Bitcoin.” The move could eventually give crypto the legitimacy it has longed for.
Frequently Asked Questions
What is spot crypto trading?
Spot trading in digital assets refers to the act of buying and selling digital assets at their current market prices.
Is spot trading crypto profitable?
Spot trading can generate profits when users buy assets at a lower price and sell them later at a higher price. The difference between the purchase and sale prices becomes the profit.
How do traders earn from spot trading?
Traders who engage in spot trading seek to profit from short-term price fluctuations in the market. They buy a cryptocurrency when they think its price will increase and sell it shortly after to realize a profit.
Appendix: Glossary to Key Terms
Spot trading: The purchase or sale of a Forex, financial instruments, or cryptocurrencies for delivery on a specified spot date.
E*Trade platform: E*TRADE is an investment brokerage and electronic trading platform operating as a Morgan Stanley subsidiary.
Reference
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