Morgan Stanley wants to expand its digital assets, including a built-in custody and exchange solution for crypto, the firm said during a conversation with Strategy World.
Phong Le, President and CEO of Strategy, spoke with Amy Oldenburg, Head of Digital Asset Strategy at Morgan Stanley, about the firm’s upcoming products.
Morgan Stanley will first allow clients on its e-trading platform to buy and sell spot cryptocurrencies through a partnership. Last year, the bank said it is pursuing a spot Bitcoin ETF and plans to enable direct trading for clients via E*Trade.
Over the next year, the bank intends to develop a fully integrated custody and exchange platform.
“This is a natural development,” the executive said. “We can’t just primarily rent the technology to do this. People expect Morgan Stanley — they trust our brand — not to be a mistake.
Morgan Stanley’s custody option for clients
The planned solution will give clients legal custody of their digital assets under Morgan Stanley’s supervision. The firm acknowledged that some customers will continue to prefer self-service, especially in Bitcoin.
Oldenburg outlined their experience with emerging markets as driving the company’s approach to digital assets.
During 26 years at Morgan Stanley, including 13 years running the firm’s emerging markets investment business, Oldenburg has observed early adoption of Bitcoin and other cryptocurrencies in 17 of the top 20 markets globally.
“As this space continues to institutionalize, we aim to provide comprehensive services to our clients,” Oldenburg said.
The bank is also exploring additional services, including yield and lending products against crypto holdings.
“It’s a natural part of the roadmap to continue to explore,” the executive said. She said they are in the early stages but are tracking momentum in decentralized finance lending and other crypto products.
Oldenburg noted that the bank manages $8 trillion in assets on its platform, and a significant portion of clients currently hold crypto off-platform.
Bringing these assets onto the platform will enable the firm to offer custody, trading and potential yield or lending services.
No specific timeline was announced for the launch of return or lending products, although the firm indicated that these would follow the rollout of the custody and exchange platform.
At the time of writing, Bitcoin is up 8% on the day and is trading near $69,000. Other related stocks and cryptos are also rising.