Morgan Stanley has revised filings for two planned exchange-traded funds tied to Ethereum and Solana, setting proposed management fees at 0.14%, the lowest among comparable products in the United States and globally. The updated S-1 forms submitted to the Securities and Exchange Commission signal an effort to establish a new pricing benchmark in crypto ETFs as competition intensifies.
Morgan Stanley undercuts rivals on fees
The 0.14% fee undercuts current market leaders, including Grayscale’s Ethereum Staking Mini ETF at 0.15% and Franklin Templeton’s Solana product at 0.19%, according to Farside data. By pricing below both, the firm positions its funds as cost leaders if approvals are secured.
ETF analyst Eric Balchunas said the proposed fee would make the products the cheapest crypto ETFs worldwide. The pricing strategy mirrors Morgan Stanley’s Bitcoin ETF launched in April, which debuted with $30.6 million in first-day inflows and has since attracted $331 million, outperforming several competing funds launched earlier in 2024.
filings suggest progress toward approval
This marks the second amendment since the initial January filings, typically viewed as a sign of ongoing engagement with regulators. If approved, the funds would become the eleventh spot Ethereum ETF and the seventh spot Solana ETF listed in the U.S.
The Ethereum ETF will trade under the ticker MSSE, while the Solana ETF will use MSOL.
staking component adds yield appeal
The filings outline a staking structure involving Figment, Galaxy Blockchain Infrastructure, and Coinbase Canada. A 5% fee will be applied to staking rewards, with 95% of generated yield passed through to traders. This high distribution rate could differentiate the products from competitors that retain a larger share of staking income.
pricing pressure builds across ETF market
Morgan Stanley’s aggressive fee strategy is likely to escalate competition among ETF issuers. By directly undercutting established products, the firm is aiming to quickly capture market share in a crowded segment dominated by larger asset managers.
This move could force other providers to reassess their pricing models, potentially driving broader fee compression across crypto ETFs.
launch comes amid weaker market conditions
The proposed launch arrives during a period of softness in the crypto market. Bitcoin prices have fallen roughly 17% over the past month, while U.S. spot Bitcoin ETFs have experienced significant outflows, with cumulative net withdrawals reaching as much as $6.35 billion.
The key question now is whether lower fees combined with staking yield can reverse the recent outflow trend. Morgan Stanley’s Bitcoin ETF, which has continued to attract inflows despite market weakness, offers an early indication that competitively priced products from major issuers can still gain traction.
Market attention is now shifting to how quickly regulators move and how competing firms respond to the pricing shift.
Curious how Solana ETFs work and what’s driving demand? Explore Solana ETF fundamentals in our concise explainer.
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