Investment bank Morgan Stanley plans to launch a spot Bitcoin ETF with a proposed fee of 0.14%, undercutting all current U.S. competitors. The move could trigger a new fee war in the $83 billion market and, if approved, would make Morgan Stanley the first bank to issue such a fund, granting its vast network of financial advisors and high-net-worth clients direct access to Bitcoin exposure.
Investment bank Morgan Stanley is seeking to launch its spot Bitcoin exchange-traded fund at a 0.14% fee. This would make it the cheapest in the U.S. market and potentially force rivals to cut fees to stay competitive.
The 0.14% fee, proposed in the bank’s latest S-1 registration statement, is one basis point below the Grayscale Bitcoin Mini Trust ETF and 11 basis points below the BlackRock-issued iShares Bitcoin Trust ETF. “Big move here. They are not messing around,” Bloomberg ETF analyst James Seyffart said, predicting the Morgan Stanley Bitcoin Trust is likely to launch in early April.
Fellow Bloomberg ETF analyst Eric Balchunas said the low fee means none of the bank’s roughly 16,000 financial advisors would feel conflicted in recommending it. These advisors manage $6.2 trillion in client assets, positioning the bank as a major gateway for wealthy investors.
Regulatory approval would make Morgan Stanley the first bank to issue a spot Bitcoin ETF. The bank previously selected Coinbase and Bank of New York Mellon as the proposed custodians for the fund.
Morgan Stanley, previously more crypto-hesitant, filed for the spot Bitcoin ETF in early January along with a Solana ETF. It then filed for a staked Ether ETF later that week and appointed a long-standing executive to lead its digital asset team.
The bank also applied for a national trust banking charter in February, seeking to custody digital assets and execute trades. In October, it had recommended a 2% to 4% crypto allocation for investors and allowed advisors to recommend crypto funds for retirement accounts.
