Morgan Stanley Files Surprise Application for Crypto-Focused Bank, Threat to XRP’s Dominance?

▲ Bitcoin (BTC), Morgan Stanley/ChatGPT-generated image ©

Global financial giant Morgan Stanley has formally applied to the U.S. Office of the Comptroller of the Currency (OCC) for approval to establish a cryptocurrency-specialized national trust bank, signaling a major shake-up in the digital asset custody market previously led by firms such as the issuer of XRP (Ripple).

According to crypto-focused media outlet CoinGape on February 27 (local time), Morgan Stanley submitted an application to establish a new national trust bank named Morgan Stanley Digital Trust National Association, utilizing its holding company structure. The application was received by the OCC on February 18, 2026, and will undergo a public comment period through March 20. The headquarters is planned for Purchase, New York, where Morgan Stanley is based, with the goal of securing comprehensive trust powers.

This move demonstrates that the Wall Street heavyweight is accelerating its expansion into the digital asset market. Morgan Stanley previously allowed its wealth management clients to invest in spot Bitcoin (BTC) exchange-traded funds (ETFs) and last month applied for crypto ETFs to provide exposure to Bitcoin, Ethereum (ETH), and Solana (SOL). The firm also plans to support Bitcoin, Ethereum, and Solana trading for E-trade clients within the year, along with launching wallet services for tokenized assets and custody.

The newly established trust bank will not be covered by Federal Deposit Insurance Corporation (FDIC) deposit insurance and will operate as an indirect wholly owned subsidiary under Morgan Stanley Capital Management. Its primary clients will be Morgan Stanley wealth management customers, including individuals, corporations, and institutions. Rather than accepting deposits, the entity will focus on trust management services such as digital asset custody and safekeeping.

As the OCC permits national trust banks to engage in certain non-trust activities, Morgan Stanley Digital Trust will, during its first three years of operation, custody select digital assets on behalf of clients and conduct related investment activities. These activities include buying, selling, transferring digital assets, and participating in staking transactions in its capacity as custodian.

If Morgan Stanley receives final approval for its application, it is expected to emerge as a formidable competitor in the institutional-grade digital asset market, joining Crypto.com, Circle, and XRP-related entities that have already obtained conditional approval. Meanwhile, Coinbase and World Liberty Financial (WLFI), associated with former President Donald Trump, are also awaiting trust approval from the OCC.

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