Wall Street’s appetite for retail crypto trading has intensified as Morgan Stanley rolls out a trading pilot on its E*Trade platform, pricing trades at a level that undercuts many traditional crypto brokers for standard retail users.
According to a Bloomberg report, Morgan Stanley is charging 50 basis points of the dollar value of each crypto transaction in the pilot. The program is currently in pilot mode, with E*Trade’s roughly 8.6 million clients expected to gain access later this year. A Morgan Stanley spokesperson confirmed to Cointelegraph that the details and fee structure described in Bloomberg’s report were accurate.
This latest push follows Morgan Stanley’s broader involvement in crypto, including its foray into a spot Bitcoin ETF ecosystem. Cointelegraph noted that the ETF, MSBT, drew about $30.6 million in inflows on its first day of NYSE Arca trading, a milestone that signals continued investor interest even as traditional banks expand into crypto access for clients.
The move illustrates a wider trend as large financial institutions seek to capture a share of retail trading revenue through crypto products, even as the ecosystem’s infrastructure and regulatory framework continue to mature.
Key takeaways
- Morgan Stanley’s E*Trade pilot charges 50 basis points per crypto trade, positioning the bank as a price leader among mainstream retail platforms.
- The pilot aims to bring 8.6 million E*Trade clients into crypto trading later this year, expanding access across a broad retail base.
- The broader appetite on Wall Street includes Charles Schwab’s recent launch of spot Bitcoin and Ether trading for retail clients at 75 basis points per transaction, underscoring a broader shift toward crypto offerings.
- Market players note that lower-fee options exist outside banks’ ecosystems, with platforms like Kraken Pro, Binance US, and Coinbase Advanced offering competitive pricing tiers for sophisticated traders.
- The momentum follows Morgan Stanley’s earlier debut of a spot Bitcoin ETF (MSBT), which attracted $30.6 million in inflows on its first day, reinforcing investor appetite for regulated crypto access from traditional financial institutions.
Pricing ambition and the retail crypto race
At its core, Morgan Stanley’s $0.005-per-dollar pricing? Not exactly. The firm’s pilot is priced at 50 basis points of the trade’s value, a rate that Bloomberg describes as aggressive relative to standard retail pricing offered by several large exchanges and brokerages. The plan to roll access out to E*Trade’s 8.6 million clients this year signals a rapid scale-up if the pilot proves sustainable, correlating with steady demand for regulated, institution-backed channels to buy and sell digital assets.
Such pricing moves raise questions about how traditional brokers balance revenue with user growth. While Morgan Stanley positions itself as a bridge between conventional finance and crypto markets, rivals—including exchanges and fintechs—have already experimented with lower fee tiers. The broader market has shown that the most aggressive price points are often paired with robust custody, insurance, and compliance frameworks that can be appealing to retail participants who remain wary of the space’s risk profile.
A broader wave of Wall Street crypto adoption
Morgan Stanley’s pilot sits within a larger arc of banking and brokerage firms expanding crypto offerings to retail and institutional clients. Earlier reports highlighted Charles Schwab’s rollout of spot Bitcoin and Ethereum trading for retail clients, beginning with a fee structure around 75 basis points per transaction. The move illustrates how mega-brokers are trying to capture a portion of retail trading revenue that once flowed primarily to crypto exchanges and alternative platforms.
Meanwhile, Goldman Sachs has moved to broaden its crypto product lineup through regulatory filings for a Bitcoin Premium Income ETF, an approach that would depend on selling call options on Bitcoin-related exchange-traded products rather than directly owning Bitcoin. This strategy reflects a broader W Street preference for investment vehicles tied to crypto exposure while managing risk through derivatives strategies.
Beyond trading and ETFs, the ecosystem is deepening on the infrastructure side. BNY Mellon has already rolled out a digital asset custody platform that began operating in the United States in late 2022, enabling select clients to hold and move Bitcoin and Ether in a regulated custodial environment. The gradual expansion of custody capabilities is a prerequisite for more active, bank-backed crypto trading and asset management services.
These developments collectively indicate a shift in the financial landscape: traditional incumbents are not only offering access to crypto but are also building the reliability and risk controls that can reassure a broader base of investors and fund managers. The industry is moving toward a model where regulated, enterprise-grade services coexist with more flexible, lower-cost trading options offered by specialized crypto platforms.
What this means for users and the market
For investors and traders, the emergence of bank-backed crypto trading pilots could translate into greater accessibility, more standardized protections, and a broader menu of regulated instruments. The price competition among major banks and high-profile brokerages may push other platforms to adjust their fee structures, potentially expanding the appeal of on-ramp products for new retail participants.
However, the consolidation of crypto capabilities within traditional financial institutions also introduces new considerations. Compliance, risk management, and the resilience of settlement rails remain critical as more clients move from pure-play crypto venues to regulated channels. Market observers will be watching how liquidity, spreads, and user experience evolve as these pilots scale from testing to routine availability across large client bases.
The broader market’s appetite for regulated access is evident in the MSBT inflows on its launch day, signaling continued investor interest in mainstream, audited products. As Morgan Stanley, Schwab and others push deeper into crypto, readers should monitor updates on client uptake, fee revisions, and any regulatory or operational hurdles that could shape how quickly these platforms gain traction.
Looking ahead, the next phase will likely reveal how quickly E*Trade users adopt crypto trading, how fee competition impacts platform economics, and what new product formats—ranging from spot to ETF-based exposures—will define retail participation in the crypto economy.
As the sector evolves, observers should watch for regulatory guidance that could influence pricing, product design, and custody standards—elements that will determine whether this wave of adoption becomes a durable layer of the traditional financial system.
For ongoing coverage, follow updates on Morgan Stanley’s E*Trade rollout, Schwab’s retail crypto expansion, and the broader bank-led push into crypto infrastructure and investment products.
