Morgan Stanley Wealth Management has rolled out a new structure that allows qualified clients to lend cryptocurrency holdings to Galaxy Digital in exchange for shares of spot crypto exchange-traded products, the firm said Friday. The offering includes access to the Morgan Stanley Bitcoin Trust, which completed its first month without recording any net redemptions.
The arrangement enables holders of bitcoin, ether, and solana to convert their assets into fund exposure without selling them. According to the firm, this could cut onboarding time for in-kind transfers by up to 75%, streamlining entry into regulated products.
Lower thresholds aim to widen participation
Galaxy Digital will reduce its minimum lending transaction size for Morgan Stanley referrals to $5 million, down from $25 million. The lower threshold signals a push to broaden access among affluent clients and deepen participation in institutional-grade digital asset services.
The structure also simplifies portfolio integration by avoiding direct liquidation of crypto holdings, which may help reduce tax friction and accelerate allocation into exchange-traded products.
Morgan Stanley builds out digital asset strategy
The initiative is part of a wider expansion led by Oldenburg, who took charge of the firm’s digital asset strategy earlier this year. Recent moves include launching a Bitcoin ETF, enabling limited spot crypto trading through a brokerage partnership, and introducing the Stablecoin Reserves Portfolio under the symbol MSNXX.
The Morgan Stanley Bitcoin Trust, launched April 8, posted $194 million in inflows during its first month and did not record a single day of outflows, making it the first new fund of its kind to achieve that benchmark.
Galaxy strengthens institutional offerings
Galaxy reported $505 million in adjusted gross profit in 2025 from its trading, lending, asset management, and staking businesses. Earlier this week, the company launched an over-the-counter prediction market trading service, beginning with a $10 million transaction.
Market backdrop shows mixed signals
The move comes during a period of uneven sentiment across crypto markets. U.S. spot Bitcoin ETFs recently logged their longest streak of net withdrawals, with about $4.33 billion exiting funds over 13 consecutive days from May 15 to June 3. The broader crypto market has also faced pressure, with total market capitalization down roughly 48% from its recent peak.
Still, early signs of stabilization have emerged. On June 4, U.S. spot ETFs recorded net inflows of $3.2 million, the strongest daily figure in two weeks, suggesting some renewed buying interest at lower price levels.
Bridging traditional finance and digital assets
Morgan Stanley’s latest offering highlights a growing effort among major financial institutions to integrate digital assets into traditional wealth frameworks. By enabling in-kind transfers into ETFs, the structure may influence liquidity dynamics, as more market participants choose lending over selling on the open market.
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