The largest bank in the US wants to offer cryptocurrency services to customers. What are we talking about?
The change of the US President is already in full swing changing the attitude of the authorities to cryptocurrencies. For example, tonight Donald Trump signed an executive order creating a working group on digital assets, which will also assess the prospects of accumulating coins as a strategic reserve. Afterwards, David Sachs, the person in charge of crypto policy, stated that he sees meme tokens and NFTs as normal collectibles. Against the background of what is happening, large banks also want to interact with coins.
US banks are starting to engage with cryptocurrencies
The head of Morgan Stanley, Ted Pick, stated that the banking giant is indeed exploring the field of cryptocurrencies to offer to its clients. In addition, the company is discussing what is happening with US financial regulators.
Morgan Stanley bank logo
Peek revealed this while talking to CNBC reporters at the World Economic Forum in Davos. Here is his line, as quoted by Cointelegraph.
For us, the key question is whether, as a highly regulated financial organisation, we can transact. We will work with the Ministry of Finance and other regulators to understand the prospects of offering something like this in a secure way.
In 2024, the banking giant has connected with the digital asset industry through spot Bitcoin-ETFs. To make matters worse, the bank undertook to offer these investment instruments to its own clients.
This decision was not appreciated by the former head of the Securities and Exchange Commission’s Internet Enforcement Division, John Reed Stark. According to him, offering BTC exchange-traded fund shares to its own users will end up with serious interest in the bank from the Securities and Exchange Commission (SEC) and the Financial Services Industry Regulatory Authority (NAIRA).
Approval of cryptocurrency spot ETFs in the US
The reaction was extremely strange considering that Bitcoin ETFs are a fully regulated instrument whose launch was approved by the SEC. Apparently, Stark is not a fan of crypto and broadcasts this attitude to the audience.
At the same time, earlier representatives of Mornan Stanley shared comments regarding the popularisation of cryptocurrencies in the world. For example, Andrew Peel, head of the bank’s digital assets department, stated that central bank digital currencies (CBDC) along with Bitcoin threaten the stability of the US dollar.
US President Donald Trump's overnight executive order on cryptocurrencies also contained a reference to CBDCs. Specifically, government agencies cannot issue or promote such assets, meaning we are unlikely to see something like this in America during the politician's new term.
According to Peel, digital assets may well lead to the abandonment of global settlement systems along the lines of the SWIFT interbank messaging protocol.
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Why investors are interested in blockchain
Among the fans of cryptocurrencies and blockchain is Larry Fink, head of the world’s largest investment fund, BlackRock. In a recent interview with CNBC, Fink called himself a “huge proponent of cryptocurrencies” and in addition called on the Securities Commission to “quickly approve” the tokenisation of traditional assets.
In addition, the BlackRock manager believes that digital assets will contribute to the democratisation of investments, i.e. accessibility to more people.
BlackRock executive Larry Fink
Tokenisation involves converting traditional assets like shares into a token format based on a particular blockchain. This increases the speed of various transactions and in addition reduces costs for financial institutions due to the higher efficiency of such networks.
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In addition, blockchain-based trading of traditional assets will be possible around the clock, rather than during certain hours, as is the case now.
As the sources note, there will be certain disadvantages here, too. In order to interact with such instruments, you will need to confirm your identity, which means that you can forget about the similarity with the sphere of decentralised finance.
Tokenised bonds, which provide stable returns for investors due to their linkage to real interest rates, may also turn out to be a competitor of stablecoins. At the very least, they will compete with dollar-based tokens for liquidity and investor attention.
BlackRock company logo
Well, tokenised shares of companies like GameStop or AMC, which are highly volatile, may well turn out to be a rival of meme tokens, which are popular today.
However, the popularisation of blockchain among banks, exchanges and other parts of the infrastructure of traditional finance will still benefit crypto. In this case, the reliability of coins based on this system will definitely not raise questions.
Morgan Stanley management's interest in cryptocurrencies reflects the changes that are coming to the coin industry in the United States. It is obvious that in case of development of adequate rules of management of the sphere, investors will be much more willing to buy crypto. Well that will easily continue the current bullrun in the industry.
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