Morgan Stanley has launched the Morgan Stanley Bitcoin (BTC) Trust on NYSE Arca under the ticker MSBT, becoming the first major US bank to issue a spot BTC exchange-traded fund (ETF).
The fund enters a crowded field of more than 10 spot BTC ETFs that collectively hold over $85 billion in assets.
Competing on Cost and Distribution
ETF analyst Eric Balchunas predicts $5 billion in assets under management within the first year and $30 million in day-one trading volume.
MSBT carries an expense ratio of 14 basis points, making it the cheapest spot BTC fund on the market. That undercuts Grayscale Investments’ BTC by one basis point and BlackRock’s iShares Bitcoin Trust (IBIT) by 11 basis points.
IBIT currently dominates with roughly 60% of total category assets.
“We really wanted to show our commitment by having that lower fee. The demand, especially from the high-net-worth investors, has been quite high. Viewed at the firm level, this is an asset class that is not going away,” Bloomberg reported, citing Allyson Wallace, Global Head of ETFs at Morgan Stanley Investment Management.
Morgan Stanley Wealth Management oversees approximately 16,000 financial advisers and trillions in client assets.
Since 2024, those advisers have been permitted to recommend third-party BTC ETFs such as IBIT and Fidelity’s FBTC. Now, MSBT keeps the management fee in-house.
Balchunas noted that the aggressive fee positioning signals strong demand from financial advisers.
A Down Market Entry
The timing is notable. BTC has fallen more than 40% from its October peak near $126,199 and traded for $71,307 on launch day.
Spot BTC ETFs experienced four consecutive months of net outflows between November 2025 and February 2026, totaling roughly $6.3 billion.
March reversed that streak with $1.32 billion in inflows, though Q1 2026 still ended with a modest net outflow.
Morgan Stanley’s willingness to launch into a down market signals that the bank views the current slump as a buying opportunity rather than a reason to wait.
ETF analyst Nate Geraci highlighted another product launching the same day, the Nicholas Bitcoin and Treasuries AfterDark ETF (NGHT).
This financial instrument provides long BTC exposure exclusively during overnight hours and rotates into short-term Treasuries during the US trading session.
What Comes Next
Morgan Stanley’s ETF ambitions extend beyond BTC. The bank filed S-1 registrations in January for both an Ethereum trust and a Solana trust.
It also plans to roll out retail crypto trading on E-Trade in the first half of 2026.
Coinbase Custody Trust Co. and Bank of New York Mellon will provide digital-asset custody services for MSBT.
The fund launched with roughly $1 million in initial seed capital and 50,000 shares available for trading.
Whether Balchunas’ $5 billion target holds will depend on how quickly Morgan Stanley’s adviser network redirects allocations, and whether BTC can stabilize long enough to bring sidelined investors back into the market.
The post $5 Billion in Year One? Bold Prediction On Morgan Stanley’s Bitcoin ETF appeared first on BeInCrypto.
Source: https://beincrypto.com/morgan-stanley-bitcoin-etf-prediction/
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