Morgan Stanley is pricing its upcoming spot bitcoin ETF (ticker MSBT) at 14 basis points annually, undercutting BlackRock's IBIT at 25 bps and Grayscale's Bitcoin Mini Trust at 15 bps. This makes it the cheapest bitcoin ETF on the market from one of the most recognizable names in wealth management. Morgan Stanley runs nearly $10 trillion in AUM across its asset management business.
This is a fee war, and fee wars are good for the end user. But the more interesting signal is what it tells you about demand. Morgan Stanley is not launching this product and pricing it aggressively because they think it will sit on a shelf. Their advisor network is clearly seeing client demand that justifies the investment. When the banks warning about bitcoin downside are the same banks racing to offer bitcoin products at the lowest possible cost, you should pay less attention to what they say and more attention to what they do. Competition should continue driving costs down, and Morgan Stanley bringing its flagship brand into the space is another step toward bitcoin becoming as boring and accessible as an index fund. Which is exactly where it should be.
Side note, the fee rate for self custody is 0 bps, and it is really not that complicated. Hold your own bitcoin!