US-based investment bank Morgan Stanley has applied for a national trust bank license to expand its activities in the digital asset field. This step could pave the way for the institution to offer services such as trading and staking, as well as storing cryptocurrencies for customers in the US.
Morgan Stanley Establishes New Unit in Digital Asset Sector
Morgan Stanley submitted its application to the U.S. Comptroller’s Office in February. The application envisages a bank structuring from scratch under the name “Morgan Stanley Digital Trust, National Association”. This license allows the bank to offer escrow, custody and trust services. The planned new unit will provide custody for selected digital assets and offer customers trading, exchange and transfer facilities.
The Search for Regulation and Infrastructure is Increasing in the Sector
Recently, there has been a noticeable increase in the initiatives of traditional financial institutions in the field of digital assets. The main reason for this trend is the increasing search of institutional investors for regulated infrastructure following the market fluctuations and major crypto exchange bankruptcies in recent years. Morgan Stanley appointed Amy Oldenburg as head of its digital assets department in recent months and began employing new experts in crypto strategies and product positions.
The bank’s digital asset vision is not limited to custody and trading. Recently, the process for the staked Ether ETF was initiated, along with applications for spot Bitcoin and Solana exchange traded funds (ETF). These applications are considered a sign of a broader strategy to integrate digital assets into classical asset services managed by the bank.
In the statements made by Morgan Stanley, it was stated that “Complying with the legislation in digital asset storage and services, where other industry players take the lead, stands out as a priority goal for the institution.”
If approved, Morgan Stanley will be able to keep its clients’ digital assets directly within the institution. Thus, the bank aims to be one of the few institutions that offer integrated services in this field without the need for third-party custody companies.
In the USA, trust banks have a narrower field of activity than full-service banks. They are generally unable to accept deposits or provide loans. However, this model has the potential to provide secure custody and settlement services, especially for stablecoin issuers and payment infrastructure providers.
The US Office of the Comptroller of the Currency recently granted national trust bank licenses to various crypto companies such as BitGo, Fidelity Digital Assets, Circle, Ripple and Paxos. This development has led to a further stretching of the boundaries between traditional financial institutions and crypto companies.
In addition to Morgan Stanley’s application, different financial platforms such as Stripe’s Bridge and Crypto.com have also made similar license applications. This process increases competition among institutions seeking to gain legal ground in crypto services.
