Morgan Stanley Enters Spot Bitcoin ETF Market with Modest Debut

Morgan Stanley has officially entered the digital asset exchange-traded fund space with the launch of the Morgan Stanley Bitcoin Trust (MSBT). Trading on the NYSE Arca, the fund attracted $30.6 million in inflows during its first day of operation, positioning it as the second-best performer for the session behind BlackRock’s iShares Bitcoin Trust (IBIT). The debut represents a milestone as the first spot Bitcoin ETF issued by a traditional US banking institution. However, the launch comes significantly later than the initial 2024 wave of approvals, resulting in a more muted reception compared to the massive volumes seen during the industry's inception. MSBT generated approximately $34 million in trading volume, slightly exceeding analyst expectations. As of April 8, the trust holds 444.4 Bitcoin, valued at roughly $31.7 million. While MSBT offers the lowest fee among its competitors, its initial traction was overshadowed by broader market selling. BlackRock's IBIT saw $40 million in inflows, but these gains were insufficient to offset heavy redemptions elsewhere in the sector. The broader ETF landscape experienced a net outflow of $124.5 million on Wednesday. Significant exits were noted in the Fidelity Wise Origin Bitcoin Fund (FBTC) and the ARK 21Shares Bitcoin ETF (ARKB), which saw outflows of $79 million and $75 million, respectively. The Grayscale Bitcoin Trust (GBTC) also recorded $11 million in redemptions, continuing a two-day trend of selling pressure.