Morgan Stanley is set to launch its spot Bitcoin exchange-traded fund (ETF) as early as Wednesday following SEC approval. The Morgan Stanley Bitcoin Trust (MSBT) will enter a competitive market led by BlackRock’s iShares Bitcoin Trust but will debut with the industry’s lowest permanent fee of 0.14% and the support of the firm’s network of approximately 16,000 financial advisors.
Morgan Stanley’s spot Bitcoin ETF is expected to begin trading after receiving a regulatory green light. The product will compete in a field dominated by BlackRock’s iShares Bitcoin Trust, which has accumulated $63.3 billion in assets since its launch.
The new ETF enters the market with a 0.14% expense ratio, undercutting BlackRock’s 0.25% fee. Bloomberg Senior ETF Analyst Eric Balchunas stated this low fee makes it “the most fiduciary product if you go by fees alone.”
He noted that Morgan Stanley’s key advantage is its “army of advisors,” referring to its approximately 16,000 financial advisors who can recommend the product to clients. This captive distribution network is seen as a significant factor for potential adoption.
The firm’s Global Investment Committee had previously recommended allocating up to 4% of investor portfolios to crypto for opportunistic growth. The SEC’s approval of the ETF further legitimizes such allocations for the bank’s clients.
Balchunas said the low fee helps advisors avoid conflicts of interest when recommending the product. He acknowledged that while “it’s not going to knock off BlackRock and become the biggest,” he believes the ETF will perform well due to its distinct strategy.
Other competitors include the Grayscale Bitcoin Mini Trust with a 0.15% fee and the VanEck Bitcoin Trust, which currently has a 0% fee waiver. Morgan Stanley’s late entry into the market focuses on differentiation through cost and internal distribution channels.
