Morgan Stanley has taken a significant step toward mainstream digital asset adoption. The bank has dropped restrictions on which of its wealth management clients can own crypto funds, marking one of Wall Street’s most open approaches to digital asset investing.

A New Era for Morgan Stanley Clients

Morgan Stanley informed its financial advisors that, starting October 15, all clients will be eligible to invest in crypto funds. This change applies across all account types, including retirement portfolios, removing previous limitations that only allowed clients with an aggressive risk tolerance and at least $1.5 million in assets to participate.

In practice, that means clients who previously couldn’t access digital assets through the bank’s advisory services can now do so, whether they hold a standard brokerage account or a retirement plan. The move signals a major expansion of crypto accessibility within the world’s largest wealth management firm, which currently oversees about $8.2 trillion in client assets.

See also: WisdomTree Launches Tokenized Private Credit Funds

Oversight and Risk Management

To prevent overexposure, Morgan Stanley will use automated monitoring systems to ensure that investors aren’t overly concentrated in crypto assets. According to sources cited by CNBC, the bank’s Global Investment Committee has set a model portfolio recommending a maximum initial crypto allocation of up to 4%, depending on an investor’s risk appetite and goals.

Lisa Shalett, the firm’s Chief Investment Officer for Wealth Management, described cryptocurrency as “a speculative and increasingly popular asset class that many investors, but not all, will seek to explore”. The guidance encourages balance, acknowledging the rising demand for crypto exposure while keeping portfolio stability as a priority.

Currently, advisors are authorized to offer bitcoin funds from BlackRock and Fidelity, but Morgan Stanley is monitoring the market for potential expansion into other digital asset funds. Clients can also request access to listed crypto exchange-traded products available on U.S. exchanges.

Aligning With Market Shifts

This policy shift follows broader regulatory and market changes in the United States. Since the election of President Donald Trump, federal sentiment toward digital assets has become more permissive, prompting major banks to reevaluate their positions. Morgan Stanley’s decision aligns with that environment, building on its previous announcement that its E-Trade subsidiary would soon enable direct trading of Bitcoin, Ether, and Solana.

The bank’s willingness to incorporate crypto across all wealth segments also reflects the competitive pressure from platforms like Coinbase and Robinhood, which have attracted a younger, more crypto-native client base. As digital assets become more integrated with traditional finance, legacy institutions like Morgan Stanley are seeking to maintain their relevance among evolving investor demographics.

Also read: Global Banks Explore Stablecoin Launch Tied to G7 Currencies

Market Timing and Industry Reactions

The timing of this move coincides with renewed momentum in the crypto sector. Bitcoin recently reached a record high of $125,000, while centralized exchange reserves hit six-year lows; an indicator of tightening supply and sustained institutional demand. Although Morgan Stanley’s changes don’t directly correlate with market prices, they add to the narrative of traditional finance leaning further into crypto exposure.

Meanwhile, global attitudes toward crypto remain mixed. In the UK, for instance, investment platform Hargreaves Lansdown recently cautioned retail investors against overcommitting to cryptocurrencies despite the Financial Conduct Authority lifting its ban on crypto-linked notes. The contrast underscores how institutions are approaching digital assets differently depending on market maturity and risk tolerance.

Looking Ahead

By dropping restrictions on which clients can access crypto funds, Morgan Stanley is positioning itself as a bridge between traditional finance and the evolving digital asset space. The move expands opportunity for everyday investors while reinforcing guardrails around exposure and diversification. As the bank continues integrating crypto through platforms like E-Trade, it reflects a broader shift, one where digital assets are no longer niche experiments but part of mainstream wealth management strategy.