Key Takeaways
- Morgan Stanley has submitted an application to the OCC for a national trust bank charter dedicated to digital asset custody
- The new entity, named “Morgan Stanley Digital Trust,” will offer comprehensive crypto services including custody, trading, swaps, staking, and asset transfers
- Citigroup is preparing to roll out institutional bitcoin custody services before year-end, incorporating crypto into its existing asset management infrastructure
- Citi’s vision includes unified account management where bitcoin sits alongside traditional securities and cash with cross-margining features
- These initiatives reflect surging institutional appetite for digital asset services delivered through established banking channels
Morgan Stanley has formally submitted a request to the Office of the Comptroller of the Currency (OCC) for authorization to operate a de novo national trust bank. The filing, submitted on February 18, identifies the proposed entity as “Morgan Stanley Digital Trust, National Association.”
This charter application would grant Morgan Stanley authorization to provide digital asset custody services for its client base. The planned subsidiary will offer a comprehensive suite of services encompassing buying, selling, swapping, transferring, and staking cryptocurrencies.
A national trust bank charter provides financial institutions with the regulatory framework to conduct fiduciary operations, including asset protection and custody services. This represents Morgan Stanley’s inaugural trust charter application dedicated exclusively to cryptocurrency services.
The investment banking giant has accelerated its digital asset strategy in recent months. During January, the firm appointed equity markets veteran Amy Oldenburg to spearhead its cryptocurrency division and submitted applications to introduce spot Bitcoin and Solana ETFs, subsequently filing for a staked Ether ETF product.
With approximately $8 trillion in assets under management, Morgan Stanley is simultaneously introducing spot cryptocurrency trading capabilities through its E*TRADE brokerage platform. The institution is also assessing potential lending products and yield-generating opportunities connected to digital currencies.
Current job postings indicate Morgan Stanley is recruiting aggressively for positions such as digital assets strategy director and digital assets product lead. Additionally, the bank is investigating wallet technology integration throughout its wealth management platform.
Citi Plans Institutional Bitcoin Custody
Citigroup has revealed intentions to introduce institutional bitcoin custody capabilities within the current calendar year. Nisha Surendran, who oversees Citi’s digital asset custody development, presented these plans during Thursday’s World Strategy Forum.
Surendran articulated the objective as rendering “bitcoin bankable.” Citigroup aims to integrate bitcoin into the identical custody, reporting, and tax infrastructure currently employed for conventional assets such as stocks and bonds.
Institutional clients will have the flexibility to initiate transactions through SWIFT messaging, application programming interfaces, or graphical user interfaces. Citigroup will manage all clearing and settlement operations internally.
The banking institution also intends to enable clients to maintain bitcoin holdings together with U.S. Treasuries, international bonds, and tokenized money market funds within a consolidated custody account. This arrangement will facilitate cross-margining capabilities between cryptocurrency and conventional asset classes.
Citi conducted research among its institutional client base and discovered minimal interest in self-managing wallets and cryptographic keys. Instead, clients prefer bitcoin access through conventional banking infrastructure they already understand.
The Broader Push by Major Banks
Citigroup maintains connections to over 220 payment and settlement networks worldwide. The bank has introduced Citi Token Services for cash management, an always-available blockchain-powered network facilitating funds movement throughout its international operations.
JPMorgan has pursued a comparable strategy through its JPM Coin offering. The New York Stock Exchange has similarly announced intentions to establish 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 during December, including submissions from Ripple, BitGo, Fidelity Digital Assets, and Paxos. Stablecoin infrastructure provider Bridge, now owned by Stripe, and Crypto.com have subsequently secured conditional approvals.
Payment processor Payoneer also submitted a national trust bank charter application this month, potentially positioning it to issue stablecoins and provide cryptocurrency services.
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