Key Highlights
- Morgan Stanley seeks national trust bank charter from the OCC to provide cryptocurrency custody services
- The proposed subsidiary, “Morgan Stanley Digital Trust,” would handle crypto custody, trading, swaps, staking, and asset transfers
- Citigroup prepares to roll out institutional bitcoin custody services before year-end, incorporating digital assets into existing frameworks
- Citi’s platform will enable clients to oversee bitcoin, securities, and cash through unified accounts with cross-margining features
- Traditional financial institutions accelerate digital asset infrastructure development in response to rising institutional demand
Morgan Stanley submitted an application for a de novo national trust bank charter to the Office of the Comptroller of the Currency (OCC). The OCC received the filing on Feb. 18 under the entity name “Morgan Stanley Digital Trust, National Association.”
This charter would grant Morgan Stanley authorization to provide digital asset custody services for its client base. The proposed subsidiary would facilitate cryptocurrency purchases, sales, swaps, transfers, and staking operations.
A national trust bank charter enables financial institutions to conduct fiduciary services including asset safekeeping and custody management. This marks Morgan Stanley’s inaugural trust charter application dedicated entirely to cryptocurrency operations.
Morgan Stanley has accelerated its digital asset expansion strategy. The firm appointed equity markets executive Amy Oldenburg in January to oversee its new crypto division and submitted applications to launch spot Bitcoin and Solana ETFs, subsequently followed by a staked Ether ETF filing.
The financial institution, managing approximately $8 trillion in client assets, plans to introduce spot cryptocurrency trading through its E*TRADE platform. The bank currently examines lending and yield products connected to digital assets.
Current job postings reveal Morgan Stanley’s active recruitment efforts for positions including digital assets strategy director and digital assets product lead. The organization continues researching wallet technology implementation across its wealth management platform.
Citigroup Prepares Bitcoin Custody for Institutions
Citigroup revealed intentions to introduce institutional bitcoin custody services within the current calendar year. Nisha Surendran, who directs Citi’s digital asset custody development, shared these plans during Thursday’s World Strategy Forum presentation.
Surendran characterized the objective as rendering “bitcoin bankable.” Citigroup aims to integrate bitcoin within existing custody, reporting, and tax infrastructure currently utilized for conventional assets including equities and bonds.
Clients will gain transaction instruction capabilities through SWIFT, APIs, or user interfaces. Citigroup will manage all clearing and settlement operations through its backend systems.
The financial institution intends to enable clients to maintain bitcoin holdings together with U.S. Treasuries, foreign bonds, and tokenized money market funds within unified safekeeping accounts. This framework would facilitate cross-margining between cryptocurrency and traditional asset classes.
Citigroup conducted institutional client surveys revealing preference against self-managing wallets and private keys. Institutional clients prefer bitcoin exposure delivered through established banking infrastructure.
Traditional Banking’s Digital Asset Expansion
Citigroup maintains connections to over 220 payment and settlement networks worldwide. The bank established Citi Token Services for cash operations, a continuously operating blockchain-based network facilitating money movement within its global infrastructure.
JPMorgan has pursued comparable initiatives through its JPM Coin product. The New York Stock Exchange revealed plans for a continuously operating blockchain-based trading venue for tokenized stocks and ETFs launching later this year.
The OCC granted conditional approval to five cryptocurrency-related national trust bank applications in December, including submissions from Ripple, BitGo, Fidelity Digital Assets, and Paxos. Stablecoin platform Bridge, acquired by Stripe, and Crypto.com have subsequently received conditional approvals.
Payoneer submitted a national trust bank charter application this month, potentially enabling stablecoin issuance and cryptocurrency service offerings.
