Morgan Stanley is taking a major step into digital assets by planning to offer cryptocurrency trading on its E*Trade platform for retail clients in the first half of 2026. The bank has selected crypto infrastructure provider Zerohash as its partner to handle liquidity, custody, and settlement, according to a Bloomberg report. The initial supported cryptocurrencies will include Bitcoin, Ethereum, and Solana. This move means clients will be able to buy and sell digital assets directly within their E*Trade accounts, alongside traditional investments like stocks and bonds, without needing to move funds to an external exchange.
Morgan Stanley had previously announced plans earlier this year to add spot Bitcoin and crypto trading to E*Trade sometime in 2026, but did not disclose specific timing or infrastructure details. The formal partnership with Zerohash marks a concrete step forward in executing that strategy.
Morgan Stanley and Zerohash Partner for Crypto Trading on E*Trade in Early 2026
Under the agreement, Zerohash will provide a full suite of back-end services for E*Trade, including market-making liquidity, digital asset custody, and trade settlement. Zerohash is a company focused on institutional-grade crypto infrastructure; it recently raised $104 million at a $1 billion valuation. Notably, Morgan Stanley is not just a customer of Zerohash but also an investor, having participated in that funding round. This gives the bank a dual role in the crypto market—both as a user and as a shareholder in the infrastructure layer.
The trading feature is expected to go live in the first half of 2026, initially supporting just three major cryptocurrencies: Bitcoin, Ethereum, and Solana. Whether additional assets will be added later depends on regulatory developments and client demand. For the millions of retail users on E*Trade, this means they can invest in crypto without having to open separate accounts on exchanges like Coinbase or Binance, using a platform they are already familiar with.
'Tip of the Iceberg': From Trading to Wallets and Tokenization
Jed Finn, Morgan Stanley's head of wealth management, described the initiative as a 'transformative moment' for the industry. 'Offering clients the ability to trade crypto is the tip of the iceberg,' Finn told CNBC, adding that the firm's broader goal is to build a full wallet solution for asset custody and tokenization. Tokenization involves using blockchain technology to create digital representations of traditional assets such as stocks, bonds, and cash, thereby modernizing back-office operations. For example, tokenized cash could begin accruing interest immediately upon landing in a digital wallet, eliminating idle balances.
In addition, Morgan Stanley plans to launch a crypto-inclusive asset allocation strategy in the coming weeks. Depending on a client's goals and risk tolerance, recommended allocations could range from 0% to a few percentage points. For Bitcoin advocates, even a small allocation from a bank as large as Morgan Stanley represents a significant step toward mainstream adoption.
Regulatory Tailwinds and Intensifying Competition on Wall Street
The timing of Morgan Stanley's move reflects a broader shift in the U.S. regulatory environment under the Trump administration, which has cleared the way for banks to expand into crypto markets. Agencies such as the Office of the Comptroller of the Currency have become more permissive, allowing traditional financial institutions to engage with digital assets more freely. Competitors like Charles Schwab are exploring similar offerings, while Robinhood has already reaped substantial rewards—generating more than $600 million from crypto trading last year, about one-fifth of its total revenue.
Notably, Morgan Stanley is not merely providing a trading channel. By investing directly in Zerohash, the bank secures a foothold in the infrastructure layer of crypto markets. This dual strategy positions Morgan Stanley to benefit both from client transaction fees and from the growth of the underlying technology platform. As the 2026 launch approaches, more traditional financial institutions are expected to follow suit, making crypto trading a standard offering in mainstream brokerage accounts and further accelerating the adoption of digital assets like Bitcoin.