Morgan Stanley advances bitcoin ETF application with amended S-1 filing

Investment banking giant Morgan Stanley has filed an amended S-1 registration statement with the U.S. Securities and Exchange Commission for the bitcoin (BTC) exchange-traded fund application submitted in January.

The latest filing, which is the second amendment to the ETF application, confirmed that the Morgan Stanley Bitcoin Trust will list on the NYSE Arca under the ticker symbol MSBT.

It also added more specific information about the fund, such as a basket size of 10,000 shares and a plan to launch with an initial seed basket of 50,000 shares, which is expected to raise approximately $1 million in proceeds. Morgan Stanley also revealed that it bought two shares of the ETF on March 9 for auditing purposes.

Earlier this month, Morgan Stanley stated in the first amendment that BNY Mellon and Coinbase will serve as custodians for the fund’s bitcoin. BNY Mellon will act as the cash custodian, administrator, and transfer agent, while Coinbase will serve as the prime broker.

The second amendment to the S-1 filing reflects forward progress in Morgan Stanley’s bitcoin ETF application, though it does not guarantee a final approval. Once approved, Morgan Stanley would become the first major U.S. bank to directly issue and sponsor its own spot bitcoin ETF.

Meanwhile, Morgan Stanley filed a spot Solana ETF application alongside the bitcoin fund in January. However, the investment bank has yet to file amendments for the Solana trust, suggesting the bitcoin ETF application is progressing more rapidly.

‘Still early’

A Morgan Stanley executive recently said that crypto ETF adoption remains in its early stages, as financial advisors continue to examine how digital assets fit into traditional portfolio models.

Amy Oldenburg, Morgan Stanley’s head of digital asset strategy, said at the DC Blockchain Summit earlier this week that most demand for spot crypto exchange-traded products still comes from self-directed investors rather than advisor-managed accounts.

“Even the distribution of these ETFs, about 80% of what we see on our platform, is coming through the self-directed business,” Oldenburg said.

Before applying to launch its own bitcoin ETF, Morgan Stanley began allowing brokerage accounts to purchase such products in 2024 and has gradually expanded access since then.

The SEC’s recent guidance designating most cryptocurrencies as non-securities could expedite the institutional adoption of crypto products, industry experts say.

“Compliance teams at asset managers and banks have had ‘regulatory uncertainty’ as the primary blocker for crypto exposure. That objection just got significantly harder to sustain,” BTC Markets Crypto Analyst Rachael Lucas previously told The Block.