Morgan Stanley has taken a significant step into the cryptocurrency market by filing an S-1 registration with the U.S. Securities and Exchange Commission on January 6. The financial giant is seeking approval for a spot Bitcoin exchange-traded fund (ETF), a move that positions it in direct competition with other major players such as BlackRock and Fidelity.
The proposed fund, known as the Morgan Stanley Bitcoin Trust, aims to hold Bitcoin directly, reflecting its price after accounting for fees and expenses. This passive investment strategy highlights a growing trend among institutional investors as regulatory environments become more favorable for digital assets. The trust will avoid the use of leverage, futures, or other derivatives, relying solely on direct Bitcoin holdings.
In its filing, Morgan Stanley outlined a structure where the net asset value of the trust will be calculated daily, based on a benchmark from major global spot exchanges. This approach is designed to provide clarity and consistency for investors. Unlike active management strategies, the fund will not react to market fluctuations, maintaining a steady course based on its underlying Bitcoin assets.
Alongside the Bitcoin initiative, Morgan Stanley also submitted paperwork for a Solana ETF on the same day, although specific ticker symbols for both funds remain undisclosed. This dual offering underscores the bank”s commitment to expanding its digital asset portfolio.
Over the past year, Morgan Stanley has gradually enhanced access to digital assets for its clients. It previously allowed for a 4 percent allocation to crypto within certain portfolios deemed “opportunistic,” aligning its practices with peers like Grayscale. As of October 15, the firm opened up cryptocurrency fund access to its entire client base, enabling advisers to recommend crypto funds to all account holders, including those with retirement plans such as IRAs and 401(k)s.
The changing regulatory landscape has played a pivotal role in the increasing interest from large financial institutions. Under the previous administration, digital assets gained broader acceptance, and recent decisions, such as those by the Office of the Comptroller of the Currency, have allowed banks to act as intermediaries in crypto transactions. Such developments have effectively blurred the lines between traditional finance and the burgeoning world of digital currencies.
As of September 2025, the SEC approved generic listing standards for crypto exchange-traded products, allowing eligible funds to launch without the lengthy reviews that previously delayed approvals. This regulatory clarity has fueled a surge in interest for ETFs among investors, who appreciate the liquidity, custody protections, and simplified oversight they offer. Following the introduction of the first U.S. spot Bitcoin ETF, banks are increasingly exploring advisory roles in the crypto space, with Bank of America permitting wealth advisers to suggest crypto exposure without minimum thresholds.
