Morgan Stanley is expanding its digital assets ambitions by rolling out cryptocurrency trading on its E*Trade platform, positioning the offering as a significantly lower-cost alternative to established retail crypto services from Coinbase, Robinhood and Charles Schwab. The investment banking giant is currently running a pilot program that charges E*Trade users a fee of 50 basis points on transaction value, undercutting competitors who charge between 60 to 95 basis points per trade.
Market Context
The move comes as institutional adoption of cryptocurrency continues accelerating across Wall Street. Major banks have been cautious about entering the retail crypto space due to regulatory uncertainty and reputational concerns, but Morgan Stanley's aggressive pricing strategy signals a more assertive stance. The broader digital assets market has seen renewed interest following Bitcoin's price appreciation and the approval of multiple spot Bitcoin exchange-traded funds earlier in 2024.
Analysis
Morgan Stanley's Head of Wealth Management, Jed Finn, framed the initiative as more than just a competitive pricing play. 'We are disintermediating the disintermediators,' Finn said, suggesting the move represents a structural shift in how institutional clients access digital assets rather than merely competing on fees. The strategy leverages Morgan Stanley's existing E*Trade customer base of 8.6 million accounts to compete directly against pure-play crypto platforms that have dominated retail trading. By offering custody solutions and lower transaction costs through its established wealth management infrastructure, the bank aims to capture market share from exchanges like Coinbase, which generated $3.32 billion in consumer transaction revenue in 2025.
Key Numbers
- Morgan Stanley's E*Trade crypto trading fee: 50 basis points per transaction
- Competitor fees: Coinbase charges up to 95 bps; Robinhood and Schwab charge 60-65 bps
- E*Trade customer base: 8.6 million accounts targeted for full rollout later this year
- Coinbase's 2025 consumer transaction revenue: $3.32 billion
- Robinhood's crypto-related revenue in 2025: nearly $1 billion
What to Watch
The planned expansion to all E*Trade customers expected later this year will be a key test of institutional crypto appetite among retail-adjacent investors. Morgan Stanley has also applied for a national trust bank charter that would allow direct custody of digital assets, potentially eliminating third-party custodians. The bank is further exploring services enabling conversion of crypto holdings into exchange-traded products without selling and preparing for potential tokenized equity trading by year-end.