Morgan Stanley's proposed 0.14% fee for its spot Bitcoin ETF aims to undercut competitors, drawing attention from industry experts.
Morgan Stanley, a major investment bank, has proposed a 0.14% fee for its spot Bitcoin exchange-traded fund in its latest S-1 registration statement. This fee would make it the cheapest Bitcoin ETF in the U.S. market, one basis point below the Grayscale Bitcoin Mini Trust ETF and 11 basis points below the BlackRock iShares Bitcoin Trust ETF.
Bloomberg ETF analyst James Seyffart described the filing as a significant development, predicting that the Morgan Stanley Bitcoin Trust could launch in early April if approved. He noted that the bank is not holding back in its approach to the market.
Analyst Reactions and Market Implications
Fellow Bloomberg ETF analyst Eric Balchunas stated that the low fee would not create conflicts for Morgan Stanley's approximately 16,000 financial advisors, who manage $6.2 trillion in client assets. This could lead to widespread recommendations of the product.
If approved, the ETF would mark Morgan Stanley as the first bank to offer a spot Bitcoin product, potentially sparking a fee war in the $83 billion market and pressuring competitors to reduce their costs to retain assets.
Morgan Stanley has selected Coinbase and Bank of New York Mellon as custodians for the ETF. The bank filed for this Bitcoin ETF in early January, along with applications for a Solana ETF and a staked Ether ETF.
Broader Bank Strategy
In late January, Morgan Stanley appointed Amy Oldenburg, a long-standing executive, to lead its digital asset team. The bank also applied for a national trust banking charter in February to handle digital asset custody and related services.
Prior to these moves, Morgan Stanley had recommended a 2% to 4% allocation to crypto in investor portfolios and allowed its advisors to suggest crypto funds for certain accounts like IRAs and 401(k)s.
