Morgan Stanley launches low-fee crypto trading on E*Trade

Morgan Stanley has officially entered the retail crypto trading market with the launch of low-cost cryptocurrency trading on E*Trade, offering fees that undercut major rivals including Coinbase, Robinhood, Charles Schwab and Fidelity.

The Wall Street bank quietly launched a pilot version of the service on 6 May, enabling select E*Trade users to buy and sell Bitcoin, Ether and Solana directly through their brokerage accounts. The platform charges a flat 0.5 per cent transaction fee, or 50 basis points, making it one of the cheapest crypto trading options among major US financial institutions.

The move marks a significant expansion of Morgan Stanley’s digital asset ambitions as traditional banks intensify competition with crypto-native exchanges for retail investors.

E*Trade crypto fees undercuts competitors

Morgan Stanley’s pricing strategy immediately positions E*Trade among the lowest-cost crypto trading platforms in the market. Charles Schwab recently introduced spot Bitcoin and Ether trading at 75 basis points, while Fidelity charges roughly 1 per cent per transaction. Coinbase retail trading fees can exceed 0.5 per cent depending on account tier and payment method.

Although Robinhood markets itself as commission-free, its spreads reportedly range between 35 and 95 basis points, often resulting in higher effective trading costs for customers. Industry analysts believe the move could trigger an industry-wide fee war similar to the race towards ultra-low expense ratios in the Bitcoin ETF market.

Morgan Stanley plans rollout to 8.6M users

The crypto trading pilot is expected to expand to all 8.6 million E*Trade customers later in 2026, potentially creating one of the largest retail crypto onboarding channels in the US brokerage industry.

Unlike crypto ETFs or fund-based exposure, the E*Trade service provides direct ownership of digital assets. Customers can hold Bitcoin, Ether and Solana inside their brokerage accounts without paying additional fund management fees.

The service does not currently support staking. Morgan Stanley partnered with crypto infrastructure provider Zerohash to power the platform’s backend operations, including liquidity, custody and trade settlement. The arrangement also removes the complexity of private key management for retail users.

Morgan Stanley deepens digital asset push

The E*Trade launch forms part of Morgan Stanley’s broader expansion into digital assets and blockchain-based financial services. Earlier this year, the bank launched its MSBT Bitcoin ETF with a 0.14 per cent expense ratio. The fund reportedly attracted more than $100 million in inflows within days of launch.

According to media, the company is also developing additional crypto investment products tied to Ether and Solana while pursuing regulatory approvals that would allow direct crypto custody and staking services.

Morgan Stanley has also applied for a national trust bank charter through the Office of the Comptroller of the Currency, a move that could strengthen its position in digital asset custody infrastructure.

Traditional banks increase pressure on crypto exchanges

Morgan Stanley’s entry into retail crypto trading intensifies pressure on established crypto platforms such as Coinbase and Robinhood. Coinbase generated $3.32 billion in consumer transaction revenue in 2025 and recently launched commission-free stock and ETF trading to compete more directly with traditional brokerages. Meanwhile, the company has cut around 700 jobs, or roughly 14 per cent of its global workforce, as the company responds to weaker trading activity and accelerates a broader shift towards artificial intelligence-driven operations. Robinhood, meanwhile, generated approximately $901 million from crypto-related activity last year, accounting for roughly one-fifth of its annual net revenue.

According to Crypto News, Morgan Stanley may hold a major advantage through its vast distribution network. The firm’s 16,000 financial advisers oversee approximately $9.3 trillion in client assets, giving the bank access to an investor base that crypto-native firms struggle to match.

The bank is also preparing a proprietary digital wallet expected to launch in the second half of 2026. The wallet is designed to support cryptocurrencies alongside tokenised stocks, bonds and real estate assets as tokenisation becomes an increasingly important trend across global financial markets.