Wall Street Giants Morgan Stanley and Citigroup Push Deep Into Cryptocurrency Services

Key Highlights

• Morgan Stanley has submitted an application to the OCC for a national trust bank charter designed for cryptocurrency custody services
• The proposed entity, dubbed “Morgan Stanley Digital Trust,” would facilitate digital asset custody, trading activities, swaps, staking services, and transfers
• Citigroup is preparing to roll out institutional bitcoin custody services within the current year, embedding them into existing traditional asset management frameworks
• Citi’s vision includes unified account management where clients handle bitcoin together with securities and cash, featuring cross-margining functionality
• Major financial institutions are building out crypto capabilities in response to rising institutional client interest in digital asset services

Morgan Stanley has submitted a request for a de novo national trust bank charter through the Office of the Comptroller of the Currency (OCC). The submission, which arrived on February 18, bears the designation “Morgan Stanley Digital Trust, National Association.”

This charter would grant Morgan Stanley authorization to provide digital asset custody services for its client base. The planned subsidiary intends to facilitate buying, selling, swapping, transferring, and staking of cryptocurrencies.

A national trust bank charter empowers financial institutions to conduct fiduciary operations including asset protection and custody services. This represents Morgan Stanley’s inaugural trust charter designed exclusively for cryptocurrency operations.

Morgan Stanley has demonstrated aggressive expansion into digital assets recently. The firm brought aboard equity markets veteran Amy Oldenburg in January to spearhead its cryptocurrency division and submitted applications for spot Bitcoin and Solana ETFs, subsequently filing for a staked Ether ETF as well.

The financial institution, which manages approximately $8 trillion in client assets, is simultaneously deploying spot cryptocurrency trading capabilities through its E*TRADE platform. The bank is also considering lending products and yield-generating opportunities connected to digital currencies.

Current job postings reveal Morgan Stanley is recruiting for positions such as digital assets strategy director and digital assets product lead. The institution is additionally investigating wallet technology implementation throughout its wealth management platform.

Citi Plans Institutional Bitcoin Custody

Citigroup has revealed intentions to introduce institutional bitcoin custody services before year-end. Nisha Surendran, who oversees Citi’s digital asset custody development, shared these details during Thursday’s World Strategy Forum.

Clients would gain the ability to initiate transactions through SWIFT messaging, APIs, or graphical user interfaces. Citi would manage all clearing and settlement procedures behind the scenes.

The financial institution additionally intends to enable clients to maintain bitcoin positions alongside U.S. Treasuries, international bonds, and tokenized money market funds within a unified custody account. This framework would permit cross-margining between cryptocurrency holdings and traditional asset classes.

Citi conducted research among its institutional client base and discovered they prefer not to handle wallets and private keys directly. Instead, they seek bitcoin access through established banking infrastructure.

The Broader Push by Major Banks

Citi maintains connections to over 220 payment and settlement networks worldwide. The bank has introduced Citi Token Services for cash management, a continuously operating blockchain-based network utilized for internal global fund transfers.

JPMorgan has pursued a comparable strategy through its JPM Coin offering. The New York Stock Exchange similarly unveiled intentions for a round-the-clock blockchain-powered trading platform for tokenized equities and ETFs launching later in 2025.

The OCC granted conditional approval to five cryptocurrency-focused national trust bank applications in December, encompassing Ripple, BitGo, Fidelity Digital Assets, and Paxos. Stablecoin infrastructure provider Bridge, acquired by Stripe, along with Crypto.com have subsequently obtained conditional approvals.

Payoneer similarly submitted a national trust bank charter application this month, potentially positioning it to issue stablecoins and deliver cryptocurrency services.

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