Morgan Stanley Slashes ETF Fees to Take on Crypto Rivals

Morgan Stanley's proposed Ethereum and Solana ETF trusts have filed amended registration statements with the SEC, setting an annual delegated sponsor fee of 0.14%. This fee is significantly lower than its competitors, including BlackRock's iShares Ethereum Trust ETF (ETHA), which carries a 0.25% sponsor fee.

The ETH trust, expected to trade on NYSE Arca under the ticker MSSE, intends to track ether and staking rewards from a portion of its holdings. The SOL trust (MSOL) intends to stake up to 100% of its Solana holdings.

Bloomberg's senior ETF analyst Eric Balchunas described the proposed fee as 'the lowest among ETH and SOL products worldwide.'

The filings are preliminary, and the SEC must declare both registration statements effective before shares trade. However, Morgan Stanley's 0.14% fee positions its products as portfolio-building blocks for institutions.

According to Bitwise's disclosed contemporaneous gross staking reward rate of 6.28%, a fully staked SOL product that retains 95% of rewards would generate roughly 5.97% before the 14 bps fee. For ETH, at a hypothetical 3% gross staking yield with 50% to 80% staked, the retained staking contribution lands between roughly 1.29% and 2.14% after fees.

The bull case requires four or more weeks of combined ETH and SOL inflows alongside Bitcoin flows turning flat, with SOL weekly inflows moving from tens of millions toward hundreds of millions.