Institutions Just Flipped the Switch: Wall Street Is Charging Full-Speed Into Crypto

Morgan Stanley has filed with the U.S. Securities and Exchange Commission to launch ETFs tracking Bitcoin and Solana. The move follows growing institutional interest in digital assets and evolving regulatory frameworks. The bank aims to offer investors a regulated way to gain exposure to the world's largest and fastest-growing cryptocurrencies.

The filings are part of a broader trend as major Wall Street firms enter the crypto market. Bank of America and Vanguard have also introduced crypto-related investment products. This marks a shift in how traditional financial institutions view digital assets, moving from cautious observers to active participants.

Bitwise Asset Management filed 11 new crypto ETF applications with the SEC, targeting altcoins like AAVE, UNI, and TAO. The strategy combines direct token holdings with ETPs and derivatives to meet regulatory requirements while providing diversified exposure.

Why Did This Happen?

U.S. regulatory clarity has accelerated institutional adoption of crypto. The SEC's recent approval of generic listing standards has allowed for faster approvals of crypto ETFs. This regulatory shift has made it easier for traditional finance players like Morgan Stanley and Bitwise to enter the market.

Regulatory developments in Europe and Asia also played a role. The EU's MiCA framework, which came into force in December 2024, is pushing crypto firms to comply with stricter standards. Japan is reclassifying major cryptos as financial products, with new tax rules set to take effect in 2026.

The market response has been positive. Bitcoin ETFs attracted over $1 billion in inflows during the first two days of 2026. This surge reflects growing investor confidence in digital assets. Solana ETFs have also seen strong demand, with over $763 million in inflows since their launch.

Bitcoin and Solana prices have remained relatively stable despite the influx of institutional capital. The market has shown signs of resilience following past volatility events like the October 2025 liquidity crisis, where over $19 billion in leveraged positions were liquidated.

Analysts are closely watching how regulatory frameworks translate into operational improvements. Market participants want to see if venues can maintain liquidity and manage risk effectively during volatile periods. The year will test whether institutions can absorb volatility without the fragility seen in past events.

Institutional adoption is expanding across multiple asset classes. Morgan Stanley has set a 4% allocation cap for digital assets in certain portfolios. Bitwise and other firms are expanding their offerings to include altcoins like Aave and Sui. These moves suggest that crypto is becoming a more mainstream asset class.

The market is also watching how ETF inflows impact the price of underlying assets. While Bitcoin and Ethereum saw price increases during the first half of 2025, newer ETFs for altcoins like Solana and XRP have not driven significant price movements. Analysts are debating whether this trend will continue.