Charles Schwab Launches Crypto Trading amid Race for Retail Investors

Charles Schwab, one of the world's biggest asset managers, with $7.13 trillion under management, is planning to offer spot cryptocurrency trading

Charles Schwab Corporation (NYSE:SCHW) is planning to offer spot cryptocurrency trading to its clients within the next year, the company disclosed during its first-quarter earnings call.

The initiative will see Schwab integrating Bitcoin (BTC) and Ethereum (ETH) trading on its platform by mid-2024, placing the traditional financial giant among the vanguard of institutions entering the cryptocurrency space.

This development follows Morgan Stanley's recent announcement to offer crypto trading to its e-trade clients, highlighting a broader trend of U.S.-based financial institutions expanding their offerings to include digital assets.

Anticipations of positive regulatory changes are also driving these efforts, with the Securities and Exchange Commission expected to make a decision on several Bitcoin ETF applications by early 2024.

“We’re hopeful and likely to have that capability by mid-2024,” Schwab CEO Rick Wurster said regarding crypto trading.

The move is designed to cater to investors who already participate in traditional markets but are becoming interested in digital assets.

Recently, Schwab saw a 400% increase in traffic to its crypto-related content, and potential new clients comprised 70% of these visitors, highlighting the growing demand, Wurster added.

Crypto Interest Soars Amid Market Turbulence

The news had an immediate impact, with Bitcoin price rising by 3.2%, increasing from around $58,400 to $60,270 within an hour of the announcement, as of May 1, 2025, according to CoinMarketCap data.

At the same time, Ethereum also saw a similar increase, at $2,900 and rising 2.8% to $2,981.

These increases were followed by significant spikes in volume. Bitcoin’s 24-hour volume increased 18% to $32.4 billion and Ethereum’s rose 15% to $14.7 billion, Binance market data shows.

Another interesting development on the liquidity front was the tremendous increase in liquidity depth—according to Kaiko Analytics, liquidity depth in BTC/USDT and ETH/USDT pairs improved by an average of 12% within two hours of the announcement.

Such a trend isn't a new one. Price jumps like this have occurred after other firms have filed a Bitcoin ETF with the S.E.C.: when BlackRock did so, BTC surged 7% in a day. These analogies remind us that institutional moves almost always have short-term effects in the world of crypto.

Schwab's timing is good, because investors' behavior has been changing. This follows average market clients' overall bearishness of the stock market that increased in April's volatility influenced in part by geopolitical tensions and U.S. tariff plans, with 61% of Schwab clients surveyed feeling bearish in Q1 2025 (up from 32%).

Several investors have been reducing risk by selling U.S.-based stocks and reallocating into bonds and non-U.S. stocks. Clients who have exposure to international stocks, bonds and commodities said they were reported stronger resilience.

And now, crypto is increasingly considered another path to diversification. Schwab's move to offer direct access to cryptos is a cautious approach that should appeal to conservative investors interested in obtaining controlled exposure rather than excessive speculation. The Schwab offering will be geared toward people wanting fractional amounts of popular cryptocurrencies, not the universe of other choices called altcoins, Wurster added.

Projecting Significant Inflows and Increased Confidence

Analysts anticipate Schwab's platform launch to generate substantial inflows into crypto markets.

Trading activity has already reflected increased confidence. On May 1, Deribit data indicated a 25% rise in BTC call options over the $65,000 strike price, which means traders are feeling bullish.

Meanwhile, trading data from Kraken showed a 10% increase in trading activity for BTC/USD and ETH/USD pairs, even as bid-ask spread margins have been diminishing—a sign that market efficiency is up.

Also reporting, Whale Alert said Bitcoin transactions valued above $1 million were up 14%, adding to the notion of institutions buying on the news of Schwab.

Recent U.S. regulatory discussions have been interpreted as boosting institutional confidence. However, Wurster cautioned that volatility and allocation issues still pose significant risks.

"We’re hopeful and likely to have that capability [crypto integration] by mid-year 2024," Wurster said.

He added that the company’s platform is designed to provide investors with the products and services they need to manage their finances effectively.

"We’re seeing a lot of interest in crypto-related content on Schwab.com and 70% of the visitors to that content are potential new clients," Wurster said.

"This underscores the strong demand we’re seeing for these types of investments