Morgan Stanley Could Stop Selling BlackRock’s Bitcoin ETF and Launch Its Own

Morgan Stanley filed its second S-1 amendment with the Securities and Exchange Commission (SEC) for the Morgan Stanley Bitcoin (BTC) Trust, a spot Bitcoin exchange-traded fund (ETF) set to trade under ticker MSBT on NYSE Arca.

If approved, MSBT would be the first spot Bitcoin ETF issued by a major US bank, marking a shift from distributing third-party products like BlackRock’s iShares Bitcoin Trust (IBIT) to capturing management fees directly.

Morgan Stanley Moves From Distributor to Issuer

Morgan Stanley began allowing its financial advisors to recommend Bitcoin ETFs to clients in August 2024, initially directing them toward existing products from BlackRock and Fidelity.

By early 2026, the bank’s more than 15,000 advisors had been authorized to proactively pitch Bitcoin ETFs rather than wait for client requests.

The economics explain the pivot. By issuing its own ETF, Morgan Stanley captures management fees estimated between 0.20% and 0.30% instead of earning distribution commissions on a competitor’s product.

The bank manages approximately $1.8 trillion in wealth management assets, making even a small allocation shift significant.

The updated filing confirms key operational details that earlier versions left open.

• Share prices will be calculated daily using the CoinDesk Bitcoin Benchmark at the 4 PM New York settlement rate.
• The trust will seed with 50,000 initial shares, generating roughly $1 million in starting proceeds.

Custody Split Between Coinbase and BNY Mellon

Morgan Stanley divided custody responsibilities between two institutions.

• Coinbase Custody Trust Company will handle physical Bitcoin storage in offline cold wallets.
• Bank of New York Mellon (BNY Mellon) will serve as cash custodian, administrator, and transfer agent.

The fund will support both cash and in-kind creations and redemptions, a structure designed for institutional authorized participants who need flexibility in how they enter and exit positions.

Morgan Stanley is not stopping at Bitcoin. The bank filed for a spot Ethereum (ETH) ETF on January 7, 2026, which will include staking provisions. A Solana (SOL) Trust filed one day earlier plans to stake a portion of its holdings and distribute rewards to shareholders quarterly.

A Crowded Queue With 126 Applications

The SEC is currently reviewing more than 126 pending crypto ETF applications as of March 2026. Morgan Stanley enters a field where competition is accelerating rapidly.

• Goldman Sachs acquired Bitcoin ETF issuer Innovator for $2 billion in 2025 and now holds $2.4 billion in crypto exchange-traded products.

• Merrill Lynch cleared its wealth advisors to recommend spot Bitcoin ETFs in January 2026.

• Fidelity amended its Ethereum ETF filing in March to add staking.
• Eight XRP ETF applications remain pending, with analysts estimating approval could unlock $5 billion to $7 billion in immediate inflows.

JPMorgan analysts project that pension funds and endowments could drive up to $130 billion in annual inflows into regulated crypto products during 2026.

The management fee, which the filing left undisclosed, will determine how competitive MSBT is against BlackRock’s IBIT at 0.25% and Fidelity’s FBTC at 0.25%.

Whether Morgan Stanley prices below, at, or above that threshold will signal how aggressively the bank intends to compete for assets it currently helps its rivals collect.