The integration of crypto with traditional finance is quickening. Major banks are launching crypto trading services, broadening stablecoin initiatives, and gearing up for regulatory changes that might allow tokenized assets to be used as collateral in derivatives markets.
This week’s Crypto Biz explores Morgan Stanley’s plan to initiate crypto trading through E*Trade, JPMorgan CEO Jamie Dimon’s cautious response to stablecoins, and the Commodity Futures Trading Commission’s (CFTC) exploration of tokenized collateral. Additionally, Strategy’s Michael Saylor downplays concerns about a waning bull market, forecasting that institutional demand will elevate Bitcoin’s value in Q4.
Morgan Stanley to provide crypto trading via E*Trade
Morgan Stanley’s discount brokerage E*Trade is set to begin cryptocurrency trading in 2026 through a partnership with infrastructure provider Zerohash, signaling that major banks are increasingly venturing into digital assets.
A Morgan Stanley spokesperson confirmed to Reuters that E*Trade clients will soon have the ability to purchase Bitcoin (BTC), Ether (ETH), and Solana (SOL), which aligns with prior reports regarding the bank’s crypto initiatives.
Morgan Stanley acquired E*Trade in 2020 for $13 billion, at which point the platform had around 5.2 million users.
With its entry into crypto trading, E*Trade will face direct competition from Robinhood, the well-known discount brokerage that has rapidly expanded its crypto offerings, including this year’s $200 million acquisition of exchange Bitstamp.
Jamie Dimon expresses “no particular worries” regarding stablecoins
JPMorgan CEO Jamie Dimon remarked to CNBC this week that he’s “not particularly worried” about stablecoins, suggesting he doesn’t view blockchain-based tokens as a threat to his bank’s core operations.
However, Dimon stressed that bank executives “should stay informed and understand it,” referencing the sector’s rapid growth and the newly passed GENIUS Act, which prohibits yield-bearing stablecoins, potentially influenced by banking lobbyists.
“There will be individuals wanting stablecoin-based ownership of dollars outside the US, whether they are bad actors or legitimate users, as it’s often preferable to retain dollars without involving the banking system,” Dimon stated.
Despite his long-standing criticism of cryptocurrencies, JPMorgan has taken steps in this arena. The bank has reported that significant institutions are deliberating “whether they should establish a consortium” to issue a stablecoin, as noted by Dimon.
CFTC reviewing framework for tokenized assets as collateral in derivatives
The Commodity Futures Trading Commission is assessing the possibility of using stablecoins and other tokenized assets as collateral in derivatives markets, potentially broadening their role in traditional finance.
Acting Chair Caroline Pham indicated that the agency will “collaborate closely with stakeholders” to devise this framework, with public feedback sought until October 20.
“The public’s message is clear: tokenized markets are present and they represent the future. I’ve long stated that effective collateral management is the ‘killer app’ for stablecoins in these markets,” Pham claimed.
Earlier this week, Pham announced new members to the CFTC’s digital asset advisory group, including representatives from Uniswap Labs, Aptos Labs, BNY, Chainlink Labs, and JPMorgan.
JPMorgan CEO Jamie Dimon also mentioned to CNBC this week that he’s “not particularly worried” about stablecoins, reaffirming his view of blockchain-based tokens not being a challenge to his bank’s core business model.
Institutional investors will elevate Bitcoin prices in Q4 – Michael Saylor
Despite recent fluctuations, Bitcoin’s bull run is poised to persist in the fourth quarter, driven by corporate treasuries and exchange-traded fund (ETF) inflows countering limited supply, according to Strategy executive chairman Michael Saylor.
In a discussion with CNBC, Saylor dismissed recent downturns in Bitcoin, asserting that “companies leveraging Bitcoin are acquiring significantly more than what miners naturally produce.” Post the April 2024 halving, miners yield only 900 BTC daily.
Public companies collectively hold over 1.03 million BTC, as industry data indicates. Strategy is the largest holder, holding 639,835 BTC on its balance sheet.
For these companies, purchasing Bitcoin “positively enhances their capital structure,” Saylor remarked.
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