Applying for a digital asset banking license: Morgan Stanley ramps up crypto custody and staking, ushering in an institutional-level competitive era

When Wall Street’s traditional giants begin applying to the Office of the Comptroller of the Currency (OCC) for a bank charter under the name “Digital Trust,” it is no longer just a simple business expansion but a landmark indicator of the deep integration between the global capital system and the crypto world. According to Bloomberg, Morgan Stanley, with nearly $9 trillion in assets under management, has officially submitted an application to establish the “Morgan Stanley Digital Trust National Association,” aiming to provide custody, trading, and staking services for digital assets within a compliant framework for its investment clients. This is not only a substantive step in Morgan Stanley’s increased investment in cryptocurrency strategies but also signals that digital assets are gradually evolving from alternative investment tools to standard components of mainstream financial infrastructure. This article will analyze the event itself, outline the timeline and causal chain behind it, dissect market sentiment, examine the authenticity and boundaries of the narrative, and project its future trajectory under multiple scenarios.

Event Overview: The Strategic Ambition Behind a License

On February 18, Morgan Stanley submitted an unusual application to the OCC seeking to establish a de novo (newly chartered) national trust bank called “Morgan Stanley Digital Trust National Association.” The proposed bank’s headquarters would be located in Purchase, New York, but its service scope plans to cover the entire U.S. Unlike traditional banking operations, the core mission of this trust company is digital assets: providing compliant custody for specific digital assets and supporting client activities such as buying, selling, swapping, and transferring. Notably, the application explicitly mentions leveraging this new license to offer staking services to its investment clients. Once approved, Morgan Stanley’s clients would be able to securely hold cryptocurrencies within a federally regulated banking system and earn staking rewards by participating in PoS (Proof of Stake) networks.

From Cautious Exploration to Full Embrace

Morgan Stanley’s foray into crypto has not been an overnight leap but a clear, step-by-step strategic evolution. Reviewing its recent intensive actions reveals a strong commitment to doubling down on crypto investments.

Personnel Preparation (January 2026): Appointed Amy Oldenburg, a senior equities executive, as head of the newly established digital assets division, building a leadership team for its crypto strategy.

Product Development (January 2026): Filed applications with the U.S. Securities and Exchange Commission (SEC) to launch spot Bitcoin and Solana exchange-traded products (ETPs), followed by additional filings for Ethereum staking ETFs.

Infrastructure Development (Early 2026): Planned to launch a proprietary digital wallet in the second half of 2026 to bridge traditional financial accounts and crypto services. Simultaneously, began large-scale recruitment on LinkedIn for roles such as digital asset strategy director and product managers, forming a specialized team.

License Application (February 2026): Officially submitted an application to the OCC for a national trust bank license, bringing its strategic push to a climax.

These actions demonstrate that Morgan Stanley is no longer content merely as a distributor of digital assets but aims to become a “crypto-native bank” integrating custody, trading, and value-added services.

Compliance Exposure and Competitive Landscape

The core of Morgan Stanley’s move is to build compliant “infrastructure” for large-scale institutional capital entry through the bank license application.

In terms of assets, Morgan Stanley manages approximately $9 trillion for clients. Even a small percentage of this allocation to crypto—say 1-5%—would amount to tens or hundreds of billions of dollars. Previously, institutions like Fidelity and Bank of America have advised clients to allocate 1-5% of their assets to Bitcoin, creating a clear demand for Morgan Stanley’s services.

From a regulatory perspective, a national trust bank license issued by the OCC differs fundamentally from a typical state trust license or custody service offered by crypto exchanges. It signifies federal banking supervision, with strict requirements on capital adequacy, custody standards, and client asset segregation. For large institutions like pension funds, endowments, and sovereign wealth funds, this is a prerequisite for including crypto assets in their portfolios.

Regarding the competitive landscape, Morgan Stanley is not alone. The OCC has recently shown a marked shift in attitude toward crypto. By December 2025, the OCC conditionally approved applications for national trust banks from five crypto-related firms including Ripple, BitGo, Fidelity Digital Assets, and Paxos. By February 2026, subsidiaries of Crypto.com and Stripe’s Bridge also received conditional approvals. Meanwhile, another major bank, Citigroup, announced plans to offer Bitcoin services to institutional clients, with a vision to “bankify Bitcoin.” In this race of traditional finance and crypto world integration, Morgan Stanley is undoubtedly among the front-runners.

Expectations, Concerns, and Reflections

Market reactions to this news are not uniformly celebratory but show multidimensional viewpoints.

Optimists: They see this as the ultimate confirmation of an “institutional bull market.” Once Morgan Stanley’s license is approved, its $9 trillion in assets could be directly opened to the crypto market. Custody solutions are viewed as the final barrier for large capital inflows. Additionally, its staking services could introduce yield-generating logic into traditional “buy-and-hold” strategies, making crypto assets more attractive to institutional portfolios.

Regulatory Caution: Focused on the speed and conditions of OCC approval. Although the OCC has relaxed somewhat recently, approvals for systemic institutions like Morgan Stanley are expected to be highly scrutinized. This camp believes the application is just the first step; from submission to final approval could be a lengthy process, with restrictions on asset types and operational details shaping the actual scope of the business.

Crypto Purists: They offer a deeper critique, arguing that entrusting assets to banks—while ensuring compliance and convenience—betrays the core spirit of Bitcoin’s “self-custody” principle—“Not your keys, not your coins.” Bank custody introduces new centralized trust entities and potential censorship risks, which conflict with the original decentralization and anti-censorship ideals of crypto technology.

Does a Bank License Equal Large-Scale Market Entry?

In analyzing the narrative that “Morgan Stanley doubles down on crypto,” we must carefully distinguish facts, opinions, and speculation.

Fact: Morgan Stanley has submitted a license application and expressed intent to offer custody, trading, and staking services.

Opinion: Many media outlets and analysts interpret this as a signal that “massive funds are about to flow in.”

Speculation: Focuses on how quickly these services will be launched post-approval, whether initial offerings will be limited to Bitcoin and Ethereum, how staking yields will be structured, and whether high management fees will be charged.

A frequently overlooked detail is that the license is titled “Morgan Stanley Digital Trust,” and its business model is “serving investment clients.” This suggests that initially, it will likely target existing high-net-worth and institutional clients rather than retail banking. Its immediate role is to meet existing client demand and prevent capital from flowing out to other compliant platforms, rather than immediately creating a massive influx of external funds. This is a process of “internalizing existing demand” and “building incremental compliant exposure.”

From Tool to Infrastructure: A Paradigm Shift

Regardless of approval timing, Morgan Stanley’s move already exerts a profound structural impact on the industry.

First, it sets a “bank-grade” standard for crypto services. Morgan Stanley’s entry will force the industry to redefine what qualifies as custody, trading, and staking—raising security, operational transparency, and compliance audit standards to the level of Wall Street investment banks. This will accelerate the淘汰 of crypto-native service providers that do not meet these standards.

Second, it opens a compliant channel for staking. For PoS networks like Ethereum and Solana, staking is a core economic mechanism. Morgan Stanley’s plan to offer staking services means institutional investors can earn yields without selling assets, greatly strengthening their long-term holding incentives. This may also prompt traditional financial institutions to explore PoS mechanisms as a new, regulated fixed-income-like asset class.

Third, it catalyzes the chemistry between traditional finance and DeFi. Banks offering staking services indirectly participate in on-chain validator mechanisms. While currently intermediated through banks, this builds a bridge allowing traditional capital to interact with decentralized protocols in a compliant manner.

Multi-Scenario Evolution

Based on the above analysis, three future scenarios can be envisioned:

Scenario 1: Optimistic (Regulatory openness, steady capital inflow)

OCC approves Morgan Stanley’s license within 2026, permitting broad digital asset activities. Morgan Stanley quickly integrates these into its wealth management platform, opening to its trillions of client assets. Initial capital inflows are cautious but grow as the security and yield benefits of bank-level custody and staking attract more institutions. Digital assets become a mainstream asset class.

Scenario 2: Neutral (Regulatory tug-of-war, phased rollout)

OCC grants the license but imposes strict conditions—perhaps initially only allowing custody of Bitcoin, with unclear or limited permission for staking. Morgan Stanley proceeds gradually, asset class by asset class. Market enthusiasm is tempered by prolonged waiting, and institutional inflows are slow and steady rather than explosive.

Scenario 3: Pessimistic (Regulatory hurdles, strategic delays)

Due to macroeconomic or political factors, or renewed regulatory concerns, approval processes are delayed or blocked. Market turmoil or scandals could lead to a conservative regulatory stance. Morgan Stanley’s crypto plans, though unchanged in intent, face long delays. This causes short-term disappointment but does not alter the long-term trend of traditional finance embracing digital assets.

Conclusion

Morgan Stanley’s application for an OCC license is more than just a corporate news story; it is a trust vote from traditional financial powerhouses in the crypto space and a coming-of-age ceremony for digital assets transitioning from fringe to mainstream. The phrase “serving clients with staking” may seem modest, but it signals a new asset paradigm: in a federally regulated bank account, your digital assets can not only be stored securely but also take root and bear fruit on the blockchain. This path will be filled with regulatory negotiations and technological refinements, but the direction is clear: Morgan Stanley’s increased crypto investment signifies not just an asset class but the foundational logic of future global finance.