Morgan Stanley slashes crypto ETF minimum to $5 million in Galaxy deal

Morgan Stanley Wealth Management partnered with Galaxy Digital to let eligible clients lend cryptocurrency in exchange for shares of spot crypto exchange-traded products, cutting minimums and onboarding times.

"Morgan Stanley has been investing in the DeFi space for some time, and we are proud to support a referral capability with Galaxy to provide Wealth Management clients with an institutionalized pathway that helps integrate digital assets into their portfolio," Alison Nest, Head of Investment Solutions Products at Morgan Stanley Wealth Management, said.

Under the arrangement, clients lend digital assets including bitcoin, ether and solana to Galaxy, which then coordinates an in-kind creation with an authorized participant to deliver ETP shares into the client's account. Galaxy reduced its lending transaction minimum for Morgan Stanley-referred clients to $5 million from $25 million, while onboarding timelines — which can exceed four weeks — may be reduced by as much as 75% in some cases, the firms said. Fees are 15 to 25 basis points, subject to transaction specifics.

The partnership bridges traditional wealth management and decentralized finance, giving Morgan Stanley's more than 15,000 financial advisors a streamlined path to integrate digital assets for high-net-worth clients. Morgan Stanley manages more than $8 trillion in client assets and has indicated bitcoin allocation ranges of 0% to 4% for certain client profiles. The firm's own spot bitcoin ETF, the Morgan Stanley Bitcoin Trust, launched in April with a 0.14% management fee and has accumulated more than 3,779 BTC worth roughly $236 million.

The referral model removes a key friction point for large holders who previously had to sell crypto to cash before buying ETP shares, triggering taxable events and delaying portfolio integration. By allowing in-kind transfers, clients can move directly from crypto holdings to ETP positions without converting to fiat currency first.

Morgan Stanley does not receive compensation for the referrals and does not control or supervise Galaxy's onboarding or services, according to the firms. Clients are responsible for their own due diligence.

This article is for informational purposes only and does not constitute investment advice.