Morgan Stanley’s MSBT Threatens BlackRock’s Bitcoin ETF Supremacy

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3 Reasons Why Morgan Stanley’s MSBT Might Be the ETF BlackRock Should Fear Most

The New York Stock Exchange (NYSE) has indicated that Morgan Stanley’s spot Bitcoin ETF, which will trade under the symbol MSBT, is approved for listing, meaning it could become available to investors shortly.

As an analyst following the space, I’m interpreting the recent listing announcement as a strong signal that the launch of MSBT is very close. If it gets the green light, this ETF would be groundbreaking – the first spot Bitcoin ETF directly issued by a major U.S. bank.

Morgan Stanley Moves From BlackRock Buyer to Competitor

Morgan Stanley reported in a recent filing that it manages more than $729 million in various Bitcoin ETFs as of December 31st.

  • Morgan Stanley has already demonstrated demand using BlackRock’s own product.

Of that total, $667.32 million sits in BlackRock’s iShares Bitcoin Trust ETF (IBIT).

Morgan Stanley became a major institutional investor in IBIT. Now, with the launch of MSBT, the bank is moving from simply selling someone else’s bitcoin fund to offering its own.

The reason for this change is financial. By starting its own fund (MSBT), Morgan Stanley will collect management fees directly, rather than just earning commissions from selling BlackRock’s fund.

  • The fee undercut

The iShares Bitcoin Trust (IBIT) is currently the leader in the market for spot Bitcoin ETFs, managing around $55 billion in assets. Since launching in January 2024, it has seen over $63 billion flow into the fund.

The fund has a 0.25% management fee. Analyst Balchunas expects a similar fee, potentially around 0.24%.

  • The captive distribution army that BlackRock can’t replicate

The main difference between MSBT and IBIT isn’t what they invest in. Both funds securely store their Bitcoin with Coinbase Custody.

Both use BNY Mellon for cash and administration. MSBT also added Fidelity as a third custodian.

The main distinction lies in how they reach clients. Morgan Stanley has around 15,000 to 16,000 financial advisors who directly manage approximately $6.2 trillion in assets for their wealth management clients.

According to Luis Berruga, a leader in ETF and asset management and former CEO of Global X ETFs, Morgan Stanley has around 15,000 to 16,000 financial advisors specializing in wealth management across the United States.

If advisors suggest MSBT, the whole process is handled internally, without needing approval or assistance from any outside companies.

Unlike other ETFs, BlackRock’s IBIT relies on a wide network of financial advisors – hundreds of firms – to suggest it to clients. This approach helped the fund grow to $55 billion, but it also means BlackRock doesn’t directly oversee how or by whom the product is sold.

As a crypto investor, I’m really excited to see that the Morgan Stanley Bitcoin ETF ($MSBT) has officially been listed on the NYSE! That usually means it’s launching very soon, which is great news for getting more exposure to Bitcoin.

— Eric Balchunas (@EricBalchunas) March 25, 2026

What Comes Next

The SEC hasn’t given the go-ahead to MSBT. Generally, it takes three to six months for the SEC to review applications for spot Bitcoin ETFs after they’ve been revised and resubmitted.

Morgan Stanley filed an updated version of their proposal on March 20, 2026. We expect a decision sometime between the middle and end of 2026.

MSBT is part of Morgan Stanley’s larger expansion into the crypto market. In January 2026, the bank applied to launch ETFs for Ethereum and Solana, and it intends to let individual investors trade cryptocurrencies through its E*Trade platform in the first six months of the year.

Whether MSBT will attract a substantial amount of investment away from IBIT is still uncertain. However, with its lower fees, established financial advisor network, and the strong reputation of Morgan Stanley, this new ETF presents BlackRock with its first real competition in the Bitcoin ETF market.

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2026-03-26 10:26