Morgan Stanley, a $9 trillion banking giant, is preparing to enter the U.S. spot Bitcoin ETF market with the lowest fee in its class.
This pricing solution indicates that the bank aims to quickly capture significant market share in one of the most competitive product categories in crypto.
Morgan Stanley sets a 0.14 percent fee for the new Bitcoin ETF
On March 27, the banking giant submitted an updated S-1 registration statement to the SEC, outlining a 0.14% fee for the upcoming ETF.
“The Trust pays a uniform Delegated Sponsor fee, which accumulates daily at an annual rate of 0.14% of the Trust's net assets (”Delegated Sponsor Fee”), and the daily bitcoin amount is determined based on the pricing comparison value,” the announcement stated.
This pricing structure is the most favorable in the market and significantly lower than the industry's leading iShares Bitcoin Trust, issued by BlackRock. IBIT currently charges a fee of 0.25%.
Nate Geraci, CEO of Nova Dius Wealth Management, noted that the proposed fee is noteworthy not only in crypto-ETFs but also more broadly in commodity-based products.
“Morgan Stanley, one of the largest and most well-known financial firms in the world, is launching a spot Bitcoin ETF. The fee for this ETF will be the lowest in the group and significantly lower than the world's largest physical gold ETF,” said Nate Geraci, CEO of Nova Dius Wealth on X.
An aggressive pricing strategy is not surprising, as competitors have been in the market for over two years.
As of 2024, the United States spot Bitcoin ETFs have attracted a total of $55.93 billion in net investments. The funds manage a total of $84.77 billion in assets, which is about 7% of the total Bitcoin supply worldwide. BlackRock's fund currently dominates the sector with $51.49 billion in net assets.
According to market observers, Morgan Stanley now has a good position to challenge leading players, thanks to its massive distribution network.
The bank's wealth management division manages approximately $6 trillion in client assets and has a network of 16,000 financial advisors.
Previously, Morgan Stanley allowed these advisors to provide clients access to third-party Bitcoin ETF funds. Its own fund enables vertical integration of cryptocurrency products and the directing of fee revenues straight to its own company.
The proposed Morgan Stanley Bitcoin ETF is just one part of the bank's extensive expansion into digital assets. In January, the company also applied for ETFs for other digital assets such as Ethereum and Solana.
In addition to ETF funds, the bank is actively developing its core infrastructure to support decentralized finance (DeFi) solutions and the tokenization of real-world assets.