“Banks holding Bitcoin on their balance sheets is on the horizon — but not yet,” Morgan Stanley’s head of digital asset strategy Amy Oldenburg told attendees at the Bitcoin 2026 Conference in Las Vegas on May 3.
Oldenburg framed the possibility as increasingly plausible after roughly 16 months of regulatory progress, but she emphasized two major roadblocks remain. First, the Basel Committee’s punitive 1,250% risk-weight for Bitcoin would need to be revised. Second, the Federal Reserve must give examiners a clear, consistent framework for how banks may report and manage crypto exposures. The Basel Committee moved in February 2026 to expedite a targeted review of its crypto standards, a sign regulators are at least re-evaluating the treatment of digital assets.
Morgan Stanley is already moving aggressively in the institutional crypto space. On April 8 the bank launched MSBT, the first spot Bitcoin ETF issued directly by a major U.S. commercial bank, with Coinbase Custody and BNY Mellon serving as dual custodians. MSBT drew $103 million in net inflows in its first eight days, and Morgan Stanley said about 80% of that exposure came via self-directed channels — notably, no advisor-driven flows so far. Oldenburg attributed slow advisor uptake to an education gap that Morgan Stanley is addressing through internal training programs.
Beyond the ETF, Morgan Stanley is pursuing an OCC digital trust charter aimed at enabling direct custody and spot trading, and the firm has filed separate trust applications for Ethereum and Solana. The bank is targeting the first half of 2026 to launch retail crypto trading on E*TRADE.
In short: regulatory momentum and new bank-led products are narrowing the gap between traditional finance and crypto, but formal changes from Basel and clearer Fed examiner guidance are likely required before U.S. banks begin holding Bitcoin directly on their balance sheets.
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