Morgan Stanley enters crypto with E*Trade pilot amid Bitcoin ETF boom

Morgan Stanley has launched a crypto trading pilot through its E*Trade platform, marking another step by traditional finance into digital assets. The move comes as Bitcoin spot ETFs in the US have already attracted nearly $60 billion in net inflows this year. Industry reactions to institutional involvement remain mixed, with some praising accessibility and others warning of centralisation risks. The bank is charging 50 basis points per transaction, a fee lower than those of major US crypto and brokerage platforms for standard retail trades. This pilot follows the January 2024 debut of spot Bitcoin ETFs, which have seen rapid adoption across 11 funds.

Venture capitalist Nic Carter has raised concerns about large institutions gaining too much control over Bitcoin. He suggests that if unresolved issues persist, major holders could eventually push to replace Bitcoin’s core developers. Carter also expects institutions to increase their Bitcoin purchases as it competes for global investment capital. Strike CEO Jack Mallers disagrees with the idea that institutional involvement undermines Bitcoin’s principles. He argues that Bitcoin was designed to be accessible to everyone, including rivals and adversaries. Mallers believes the network’s decentralised nature will endure despite growing institutional participation.

The pilot reflects a broader trend of traditional finance firms expanding into digital assets. With lower fees and rising institutional interest, Bitcoin’s integration into mainstream markets continues. How this shift affects the network’s decentralisation remains a key point of debate among industry figures.