Morgan Stanley’s recent entry into the Bitcoin exchange-traded fund (ETF) market has seen a highly successful start. The fund, which launched on April 8, reached $193 million in new investments within its first month. These inflows boosted the Morgan Stanley Bitcoin Trust (MSBT) to over $240 million in assets under management, outperforming initial expectations and demonstrating robust investor interest.
What drove the strong initial figures?
On the first day, MSBT achieved deposits of $30.6 million and trading volumes of $34 million, marking it as one of the most successful ETF launches on record, according to Bloomberg’s Eric Balchunas. This strong debut showcases the fund’s momentum, as noted by Amy Oldenburg, Morgan Stanley’s head of digital asset strategy, who described the launch as unprecedented in the company’s history.
While other major spot Bitcoin ETFs, including those from BlackRock and ARK Invest, faced net outflows during Bitcoin’s price volatility between $70,000 and $80,000, MSBT consistently attracted new capital every single day of its first month.
How does MSBT stand out with its low fees?
MSBT’s competitive edge can be attributed to its low sponsor fee of 0.14 percent, one of the lowest in the market. This fee structure is designed to appeal particularly to large investors, offering better returns than competitors like Bitwise and ARKB, and industry leaders IBIT and FBTC, whose fees are higher.
This advantage draws significant interest, especially from institutional investors with large portfolios, making minor fee differences notable for cost savings. In its initial phase, the fund attracted predominantly individual investors, as the access through Morgan Stanley’s advisory network was yet to be activated.
Oldenburg commented, “In the first week and the days after, nearly every trade we saw in the fund came from self-directed individual clients,” indicating a strong base from individual investors.
In subsequent trading sessions, MSBT continued to garner formidable inflows, gaining another $13 million in capital even when rivals experienced steep outflows. Notably, on a challenging day, May 7, it secured $5.7 million in new investments while Fidelity and BlackRock faced significant losses.
- MSBT showed a 0.24 percent premium over its net asset value — a strong signal of demand exceeding supply.
- The fund sits in the top 32 globally based on the number of Bitcoins held, totaling approximately 2,620 BTC.
- In just six weeks, US-based Bitcoin ETFs saw inflows reaching $3 billion, underscoring growing institutional investment interest in cryptocurrencies.
Interest in cryptocurrency assets continues to grow. US spot Bitcoin ETFs have amassed $59.3 billion in investments since January, and total managed assets across the sector now exceed $106.6 billion, signifying a strong trend towards digital currency investment.
