Bitcoin's integration into the banking system is moving from theory to reality. At the Bitcoin Conference in Las Vegas, Amy Oldenburg, Head of Digital Asset Strategy at Morgan Stanley, revealed that the Wall Street firm is actively expanding its digital asset footprint amid growing client demand. She stated:
“We have been deeply involved in digital assets for years, and the regulatory environment is now more supportive than ever.”
Oldenburg believes that U.S. banks will eventually hold bitcoin on their balance sheets, but several significant obstacles remain.
The Three Regulatory Hurdles for Bank Bitcoin Holdings
According to Oldenburg, for a bank of Morgan Stanley’s size to hold bitcoin, it must first secure clearance from the Federal Reserve, comply with the Basel Accords’ capital requirements for cryptoasset exposures, and win consensus from multiple global regulators—all three conditions are essential. Robin Vince, CEO of BNY Mellon, echoed this view in March, emphasizing that regulatory clarity is the single biggest prerequisite for traditional finance to fully embrace digital assets and that large banks will act as the bridge linking conventional and crypto markets.
MSBT ETF Draws $100M in First Week Despite Advisor Gap
While the regulatory landscape evolves, Morgan Stanley has taken early action by launching a spot bitcoin ETF called “MSBT”—the first such product from a U.S. chartered bank. In its first six trading days, MSBT attracted over $100 million, all from unsolicited client investments; the bank’s financial advisors had not even begun recommending it. Oldenburg noted that 80% of ETP positions on the bank’s wealth management platform are client self-directed, indicating strong organic demand. Yet the bank’s recommended bitcoin allocation stands at only 2% to 4% of a portfolio, and many clients lack systematic guidance. To close this gap, Morgan Stanley has initiated internal training programs to upskill its advisor force in digital assets. This demand for compliant bitcoin investment vehicles is undeniable: BlackRock’s spot bitcoin ETF IBIT has amassed over $61 billion in assets since its January 2024 debut, making it the fastest-growing ETF ever launched.
Applying for an OCC Digital Trust Charter to Enable Custody and Spot Trading
Oldenburg further disclosed that Morgan Stanley is seeking a Digital Trust Charter from the Office of the Comptroller of the Currency (OCC). Once granted, the license would allow the bank to directly custody cryptocurrencies for clients and potentially offer spot trading of bitcoin and other assets on its wealth management platform. For now, the MSBT product uses a dual-custody model, with Coinbase and BNY Mellon jointly safeguarding assets—an arrangement that satisfies current compliance demands while giving the bank time to build its own proprietary digital asset servicing infrastructure.