Morgan Stanley Files 0.14% Bitcoin ETF, Lowest Fee Yet

Morgan Stanley has filed an S-1 registration statement proposing a 0.14% fee for its spot Bitcoin ETF, which would make it the cheapest product in the US market if approved.

The proposed fee sits one basis point below the Grayscale Bitcoin Mini Trust ETF, currently the market’s lowest-cost option, and 11 basis points below BlackRock’s iShares Bitcoin Trust ETF (IBIT).

Analysts react

Bloomberg ETF analyst James Seyffart called it a bold move, predicting the Morgan Stanley Bitcoin Trust (MSBT) is likely to launch in early April.

Fellow Bloomberg analyst Eric Balchunas noted the strategic logic behind the pricing:

“They are the ultimate gatekeepers of rich boomer money.”

Balchunas argued the low fee means none of Morgan Stanley’s roughly 16,000 financial advisors — who manage $6.2 trillion in client assets — would feel conflicted recommending the product to clients.

Fee war ahead

Given that US spot Bitcoin ETFs track bitcoin’s price directly, Morgan Stanley’s ultra-low fee could spark a fresh pricing war across the $83 billion market, putting immediate pressure on rivals like Fidelity’s FBTC to cut costs or risk losing assets under management.

Regulatory approval would make Morgan Stanley the first bank to issue a spot Bitcoin ETF, opening bitcoin exposure to millions of high-net-worth clients.

Morgan Stanley’s crypto push

Morgan Stanley filed for the spot Bitcoin ETF in early January, alongside a Solana ETF, then filed for a staked Ether ETF later that same week.

The bank also applied for a national trust banking charter on Feb. 18, seeking to custody digital assets and execute purchases, sales, and swaps for clients, including staking services.

Morgan Stanley previously selected Coinbase and Bank of New York Mellon as proposed custodians for the fund.

In October, before adopting its institutional crypto strategy, the bank had already recommended a 2% to 4% crypto allocation for investors and allowed advisors to suggest crypto funds for IRA and 401(k) clients.