Morgan Stanley's E*TRADE Opens Spot Crypto to Retail
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- E*TRADE launched spot crypto trading for eligible retail clients to buy, sell, and hold Bitcoin, Ether, and Solana through a Zero Hash partnership, with crypto holdings viewable alongside traditional investments and on-platform transfer functionality expected later this year.
- Trades carry a 50-basis-point fee, while custody and transaction services run through separate Zero Hash accounts that are not covered by FDIC or SIPC protections.
- Morgan Stanley plans to transition the digital asset services to Morgan Stanley Digital Trust, its national trust bank currently in organization.
- The self-directed E*TRADE channel served 8.6 million households and held about $1.56 trillion in client assets as of March 31.
- In April, Morgan Stanley launched a stablecoin reserve offering allowing issuers to hold the assets backing their tokens in the firm's money market funds while earning interest.
- Morgan Stanley's spot Bitcoin ETF debuted in April with a 0.14% management fee—the lowest-cost Bitcoin ETF on the US market at the time—and has since attracted roughly $385 million in cumulative net inflows, per SoSoValue data.
- In June, Morgan Stanley amended its proposed spot Ether and Solana ETF filings to set management fees at 0.14%.
Why it matters: With 8.6 million E*TRADE households and $1.56 trillion in client assets now able to trade spot crypto, Morgan Stanley has converted a massive retail brokerage footprint into a crypto on-ramp—but the 50 bps fee and absence of FDIC or SIPC coverage on the Zero Hash-held assets expose clients to risks that bypass traditional banking safeguards.
