Morgan Stanley, Galaxy start $5M crypto lending route

Morgan Stanley Wealth Management has set up a referral arrangement with Galaxy Digital that lets eligible clients lend bitcoin, ether and solana and receive spot crypto exchange-traded product (ETP) shares in return. Galaxy reduced the minimum loan for Morgan Stanley-referred clients to $5 million from $25 million, and Morgan Stanley estimates the process can shorten onboarding times by up to 75%.

Under the arrangement, Morgan Stanley will refer qualifying wealth-management clients to Galaxy. Galaxy will accept crypto loans, assess whether a loan can be settled in-kind with ETP shares, and, when appropriate, coordinate with an authorized participant to create shares and deliver them into a client account selected by the client. Eligible assets for the program are BTC, ETH and SOL. Available products may include spot-focused offerings such as the Morgan Stanley Bitcoin Trust (MSBT) from Morgan Stanley Investment Management.

Morgan Stanley intends the pathway to let advisors move clients from direct crypto holdings into regulated products that sit inside brokerage accounts. The firm said comparable conversions can take longer than four weeks and that the referral process could reduce those timelines in some cases. Morgan Stanley Wealth Management will provide educational resources about digital assets and will handle client referrals to Galaxy.

Galaxy will manage the lending mechanics and the ETP settlement process, including any in-kind creation with an authorized participant. Zane Glauber, Galaxy’s global head of distribution, commented that the arrangement lowers transaction minimums and streamlines onboarding so clients can integrate digital assets alongside traditional investments.

Alison Nest, head of investment solutions products at Morgan Stanley Wealth Management, noted the firm has invested in decentralized finance and expects the referral pathway to provide a more institutional route for clients seeking exposure to digital assets within wealth-management accounts.

Clients must meet Morgan Stanley Wealth Management eligibility requirements to be referred and must satisfy Galaxy’s lending criteria. The referral model does not change Galaxy’s role in assessing loan suitability or the regulatory status of the ETPs.

Exchange-traded products tied to spot cryptocurrencies provide securities-based exposure rather than direct token custody. In-kind creation allows an issuer, via an authorized participant, to exchange underlying tokens for newly issued ETP shares, a mechanism that can reduce trading and tax frictions. The partnership follows a trend of wealth managers building ways to hold digital assets inside standard advisory and brokerage frameworks to simplify custody and compliance for clients.