3 Reasons Morgan Stanley’s MSBT ETF Could Be the Biggest Threat to BlackRock

Jakarta, Pintu News – Morgan Stanley is preparing to launch its first spot Bitcoin Exchange-Traded Fund (ETF) product under the code MSBT on the New York Stock Exchange (NYSE). The move marks a major change in the crypto investment landscape, especially as Morgan Stanley becomes the first major US bank to issue a spot Bitcoin ETF directly.

The presence of MSBT is predicted to be a serious threat to BlackRock’s dominance with the iShares Bitcoin Trust ETF (IBIT) which has been leading the market. With a strong distribution strategy, lower management fees, and an extensive network of financial advisors, MSBT has the potential to change the map of Bitcoin ETF competition in the United States.

Morgan Stanley Transforms from Partner to BlackRock Challenger

Morgan Stanley was previously known as one of the largest institutions holding BlackRock’s Bitcoin (BTC) ETF, IBIT, with an investment value of $667.32 million out of a total Bitcoin ETF holding of $729 million. However, with the launch of MSBT, Morgan Stanley is now moving from simply distributing a competitor’s product to becoming a major issuer of its own.

The move is economically logical, as Morgan Stanley can directly earn management fees, not just distribution commissions from BlackRock products. In doing so, the bank not only strengthens its position in the market, but also increases potential revenue from the growing digital asset sector. IBIT’s dominance of the Bitcoin ETF market is hard to match, with assets under management reaching around $55 billion and net inflows of more than $63 billion since its launch in January 2024.

However, MSBT offers a predictably lower management fee of around 0.24%, one basis point below IBIT’s 0.25%. The product structures of MSBT and IBIT are actually similar, both storing Bitcoin (BTC) in cold storage through Coinbase Custody and using BNY Mellon for cash administration. However, MSBT adds Fidelity as a third custodian, providing an additional layer of security for investors.

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Internal Distribution Network: Morgan Stanley’s Key Strengths

MSBT’s key advantage lies in Morgan Stanley’s vast internal distribution network, with approximately 15,000 to 16,000 financial advisors managing $6.2 trillion in client assets. Each MSBT investment recommendation from these advisors will be directly integrated within the Morgan Stanley ecosystem, without the need for third-party approval or promotion.

This gives Morgan Stanley full control over the sales and marketing process of its Bitcoin (BTC) ETF product. As such, MSBT’s market penetration potential is much greater than IBIT, which relies on a network of external advisors from various companies.

In contrast, BlackRock has to rely on hundreds of external advisory firms to market IBIT, so it cannot fully control who sells the product or how aggressively they promote it.

Morgan Stanley’s internal distribution model allows the investment process to be more efficient and focused on the interests of their own clients. In addition, the strength of the Morgan Stanley brand, which is already trusted among institutional and retail investors, is an added value. With this strategy, MSBT has the potential to capture a significant market share from IBIT in a short period of time.

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Morgan Stanley’s Crypto Expansion and Future Prospects

The launch of MSBT is just part of a wider crypto expansion strategy at Morgan Stanley. The bank has also applied for Ethereum and Solana ETFs by January 2026, and plans to bring retail crypto trading services through its E*Trade platform in the first half of the year.

These moves demonstrate Morgan Stanley’s commitment to becoming a major player in the digital asset sector, not only in Bitcoin (BTC) but also in various other crypto assets. Although approval from the Securities and Exchange Commission (SEC) for MSBT is still in progress and is expected to take three to six months from the filing of the last amendment on March 20, 2026, market enthusiasm has already begun to be felt.

If approved, MSBT will be the first spot Bitcoin (BTC) ETF issued directly by a major US bank, giving Morgan Stanley an unprecedented competitive advantage. With a combination of low fees, in-house distribution network and product innovation, MSBT is poised to become IBIT’s main competitor and change the dynamics of the Bitcoin ETF market in the United States.

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Reference

• BeInCrypto. Morgan Stanley’s MSBT Threatens BlackRock’s IBIT. Accessed on March 27, 2026
• Featured Image: Cryptoslate