Morgan Stanley officially debuted its spot Bitcoin ETF (MSBT) on Wednesday, becoming the first major U.S. commercial bank to enter the space. According to data from Farside Investors, the fund recorded $30.6 million in inflows on its first day of trading.
Despite the strong start for MSBT, the broader spot Bitcoin ETF market has seen recent volatility. The category saw a total net outflow of $124.5 million on Wednesday, marking the second consecutive day of net redemptions. However, thanks to Monday’s massive $471 million inflow—the highest single-day total since February—the market remains in net positive territory for the week.
Low-Fee Strategy and Competitive Outlook
Morgan Stanley has adopted an aggressive pricing strategy. With a fee of just 0.14%, MSBT is not only cheaper than industry leader BlackRock’s IBIT (0.25%) but currently stands as the lowest-cost Bitcoin ETF on the market. On Wednesday, BlackRock’s IBIT attracted $40.4 million in inflows, bringing its total assets under management to $56 billion.
Bloomberg Intelligence analyst James Seyffart suggests that Morgan Stanley may be using the product as a "loss leader." He noted, "This is likely their way of trying to attract high-net-worth individuals in the crypto space and bringing those wealth management clients into their ecosystem."
Seyffart’s colleague, Eric Balchunas, remains optimistic about the fund's prospects. On X (formerly Twitter), he called the launch of MSBT "the most significant launch since the Bitcoin ETFs started" and predicted that the fund could reach $5 billion in assets under management within its first year. Balchunas previously told Decrypt that Morgan Stanley’s massive team of financial advisors provides a "captive audience," which serves as a core competitive advantage.
According to CoinGecko, Bitcoin is currently trading at $71,260. Despite a minor 0.6% dip today, the asset is still up 6.6% for the week. On the prediction market Myriad, sentiment remains split, with users seeing roughly equal odds of the price hitting a new high of $84,000 or sliding back down to $55,000.