Even though the bank is entering a very competitive space dominated by BlackRock and Fidelity Investments, the firm is positioning itself aggressively with a low 0.14% fee and leveraging its vast advisor network to drive adoption. Morgan Stanley also has plans for additional crypto ETFs and expanded services like custody, trading, and staking.
MSBT Bitcoin ETF Debuts on NYSE
Morgan Stanley is making a big move into the cryptocurrency market with the launch of its Bitcoin exchange-traded fund (ETF), the Morgan Stanley Bitcoin Trust (MSBT), on NYSE Arca. The fund is scheduled to debut today on April 8, making Morgan Stanley the first major commercial bank in the United States to offer a spot Bitcoin ETF.
NYSE MSBT listing notice (Source: NYSE)
The MSBT launch comes at a time when the Bitcoin ETF market is already highly competitive. Major players like BlackRock, with its iShares Bitcoin Trust (IBIT), and Fidelity Investments, with its Wise Origin Bitcoin Fund (FBTC), have dominated the space since their launches in early 2024. Together, these funds have attracted tens of billions of dollars in inflows.
Morgan Stanley is taking an aggressive approach by setting a low management fee of 0.14%, which could place pressure on rival issuers to reduce their own fees to stay competitive.
Industry analysts have pointed out that Morgan Stanley’s extensive network of financial advisors could also play a critical role in driving adoption of the new ETF. Bloomberg analyst Eric Balchunas said that the firm’s advisors oversee trillions of dollars in client assets, which makes them key gatekeepers to a large pool of potential capital. This distribution advantage could help MSBT gain traction a lot more quickly than typical new entrants.
To support its ETF operations, Morgan Stanley with Coinbase and Bank of New York Mellon as custodians, to ensure institutional-grade security and infrastructure for the fund.
Beyond MSBT, the bank has other ambitions in the digital asset space. It has applied for a national trust banking charter that will allow it to expand into crypto custody, trading, and staking services.
Additionally, Morgan Stanley has already filed proposals for other crypto-based investment products, including a staked Ether ETF and a Solana ETF. These moves, along with leadership changes like appointing Amy Oldenburg to head its digital asset division, all prove that the bank is preparing to expand in the crypto market.
