In a significant move within the cryptocurrency investment landscape, Morgan Stanley has officially submitted filings for two exchange-traded funds (ETFs) focused on Ethereum and Solana, both featuring a remarkably low management fee of 0.14%. This fee structure, noted by Bloomberg ETF analyst Eric Balchunas, is set to be the lowest in their respective categories worldwide, surpassing competitive fees from other prominent funds.
The proposed ETFs, named the Morgan Stanley Ethereum Trust and the Morgan Stanley Solana Trust, are intended for listing on NYSE Arca with the ticker symbols MSSE and MSOL. Each trust will implement a unitary sponsor charge of 0.14% per annum, payable on a monthly basis and accruing daily on the net asset value.
If granted approval by the Securities and Exchange Commission (SEC), this competitive fee would overshadow others in the market, including Grayscale’s Mini Ethereum Trust at 0.15% and Franklin Templeton’s Solana ETF, which stands at 0.19%. The Solana-focused ETF would aim to stake up to 100% of its assets, while the Ethereum equivalent would typically stake between 50% to 80% of its holdings. Notably, 95% of the staking rewards will be distributed to shareholders.
Morgan Stanley’s latest fee structure mirrors that of its recently launched Spot Bitcoin ETF, which debuted at the same 0.14% fee and has reportedly attracted around $300.7 million in cumulative net flows.
In a parallel development, Franklin Templeton has also filed for two innovative ETFs designed to reinvest stock dividends as Bitcoin (BTC). The Franklin US Equity Bitcoin DRIP Index ETF and the Franklin US Innovation Bitcoin DRIP Index ETF plan to mirror VettaFi indexes with an asset allocation of 95% in stocks and 5% in Bitcoin. Reinvestments in Bitcoin will occur on the market open the day following the ex-date of dividends. If Bitcoin’s proportion surpasses 5%, a cap of 20% will be enforced at each quarterly rebalancing.
Franklin Templeton’s new offerings will provide exposure to spot Bitcoin ETFs, futures, options, and assets managed through a branch based in the Cayman Islands. However, details regarding fees, ticker symbols, and listing exchanges have yet to be made public.
These simultaneous filings mark a notable division in the U.S. cryptocurrency ETF market. Morgan Stanley and Grayscale are combating each other by reducing management fees, while Franklin Templeton and BlackRock are competing primarily through innovative product designs.
As of now, both of Morgan Stanley’s proposed ETFs are under SEC review, and no launch dates have been announced. Conversely, Franklin Templeton’s ETFs can automatically become effective within 75 days, potentially launching as early as September 1, absent any intervention from the SEC.
At the time of this update, Bitcoin was trading around $64,115, experiencing a slight decline of 0.2% over the last 24 hours. Retail sentiment on platforms like Stocktwits remains in a neutral zone, with low discussion levels observed regarding Bitcoin amidst a challenging year where its value has dropped over 26%.
