Morgan Stanley has submitted a second amended S-1 registration filing for a proposed spot Bitcoin exchange-traded fund, bringing the Wall Street bank closer to launching the product under the ticker MSBT. The filing outlines the fund’s seed capital structure, trading partners, and plans to list on NYSE Arca. The trust expects to raise $1 million through the sale of 50,000 initial seed shares to its delegated sponsor prior to listing, with the proceeds used to purchase Bitcoin for the fund. The fund still requires regulatory approval before trading can commence.
The amended filing identifies Jane Street, Virtu Americas, and Macquarie Capital as authorized participants for the ETF. These firms are permitted to create or redeem large blocks of shares and may profit from arbitrage between Bitcoin’s market price and the ETF’s share price. This mechanism is designed to keep the ETF’s trading price aligned with the underlying value of Bitcoin. The inclusion of established trading firms signals a structured approach to market liquidity.
Morgan Stanley’s move into its own Bitcoin ETF product represents a strategic shift from its previous role as a distributor of other firms’ funds. Marcin Kazmierczak, co-founder of RedStone, noted that the bank is transitioning away from distributing BlackRock‘s IBIT toward issuing its own product, which would allow it to capture management fees directly rather than earning distribution commissions. He added that the bank’s 15,000 financial advisors would provide significant distribution capacity for the new ETF. This internal sales network could prove a meaningful advantage in reaching retail and institutional investors.
The bank has been gradually expanding its crypto-related offerings in recent months. In October 2025, Morgan Stanley recommended a 2% to 4% allocation to crypto within portfolios for investors and financial advisers. The bank also permitted its financial advisors to recommend crypto funds to clients holding individual retirement accounts and 401(k)s. These steps reflect a broader institutional embrace of digital asset exposure.
Morgan Stanley’s filing comes amid a wider trend of major US financial institutions increasing client access to crypto products. Starting January 5, 2026, Bank of America, the second-largest US bank, began allowing advisers in its wealth management divisions to proactively recommend exposure to four Bitcoin ETFs, which had previously only been available upon client request. One day prior, Vanguard, the world’s second-largest asset manager, enabled crypto ETF trading for its clients, reversing its longstanding opposition to digital asset ETFs.
BlackRock, the world’s largest asset management firm, had already recommended an allocation of up to 2% in Bitcoin to its clients in December 2024. The collective moves by these institutions suggest a significant shift in how mainstream finance is approaching digital assets. As more large players enter the space, competition among ETF issuers is expected to intensify. The outcome of Morgan Stanley’s regulatory review will be closely watched by the broader industry.
Originally reported by CoinTelegraph.
