Morgan Stanley Backs Zerohash, Plans Crypto Trading for E-Trade

Zerohash announced Tuesday that it raised $104 million in a Series D-2 round led by Interactive Brokers, with participation from SoFi, Apollo-managed funds, and Jump Crypto. Morgan Stanley joined the raise, pushing the beginup’s valuation to $1 billion and officially making it a unicorn. The firm specializes in blockchain-based infrastructure for fiat, stablecoins, and digital assets delivered through APIs that allow brokerages and fintechs to embed crypto into their platforms.

At the identical time, Morgan Stanley will tap Zerohash’s infrastructure to power its upcoming crypto rollout for E-Trade. The plan is to enable direct trading of BTC, ETH, and SOL for millions of retail clients in what the bank calls “phase one” of a broader strategy. Rivals like Robinhood already offer crypto access, and Morgan Stanley’s move reflects growing pressure among traditional brokerages to match those features.

Investor Takeaway

Why This Funding Round Matters

Zerohash’s $104 million raise comes amid a wave of institutional interest in blockchain infrastructure. Interactive Brokers’ lead role underscores how incumbent financial firms are accelerating adoption by investing in back-end providers rather than building technology from scratch. With SoFi, Apollo, and Jump Crypto also joining the round, the cap table reflects a blend of traditional finance and crypto-native capital betting on institutional integration.

“Every financial institution is looking to provide access to the crypto asset class and innovate with this technology at scale,” said Zerohash CFO Adam Berg. “I’ve recently met with multiple large bank CEOs and financial services executives, many of whom said they are spending more than 50% of their time driving on-chain innovation at their firms.”

The company’s infrastructure is already used to support fiat-to-crypto transactions, stablecoin settlement, and custody services. With Morgan Stanley as both an investor and client, Zerohash gains validation from one of the most risk-averse segments of the financial industry. The unicorn valuation signals confidence that the market for compliant crypto infrastructure is expanding rapidly as regulatory barriers ease.

Morgan Stanley’s Evolution in Digital Assets

Morgan Stanley has historically approached crypto cautiously. Its exposure was mostly limited to investments in BTC or BTC ETFs, as well as select venture bets like its 2021 co-lead of a $48 million Series B round in Securitize, a tokenization platform. Allowing E-Trade’s retail clients to trade major cryptocurrencies directly marks a more aggressive step toward mainstream adoption.

Jed Finn, Morgan Stanley’s head of wealth management, told Bloomberg: “The underlying technology has been proven and blockchain-based infrastructure is obviously here to stay. Clients should have access to digitized assets, traditional assets, and cryptocurrencies, all in the identical ecosystem that they’re used to.”

The new offering will place E-Trade alongside competitors like Robinhood and PayPal, which already provide access to crypto assets. For Morgan Stanley, integrating crypto trading within its regulated brokerage environment could appeal to clients who want digital asset exposure without leaving their primary financial ecosystem.

Investor Takeaway

Regulatory Tailwinds and Market Implications

The expansion comes during a period of renewed momentum for digital assets in the U.S. Since the Trump administration took office earlier this year, industry executives say regulatory obstacles have eased, encouraging innovation and investment. Approval of spot BTC ETFs, rising institutional flows, and landmark IPOs from Circle, Bullish, and Gemini have reset expectations for how crypto integrates with mainstream finance.

Morgan Stanley’s bet on Zerohash and its retail rollout illustrates how traditional financial firms are no longer content to sit on the sidelines. Instead, they are embedding crypto trading within existing platforms and partnerships, avoiding the reputational and operational risks of building from scratch. For Zerohash, the Series D-2 round not only secures growth capital but also positions it at the center of Wall Street’s next wave of digital asset adoption.

The coming months will determine how smoothly E-Trade’s crypto integration unfolds and whether Morgan Stanley can diverseiate its offering from existing platforms. But the signal is clear: one of America’s largest banks now views direct crypto access for retail clients not as optional, but as necessary.