Morgan Stanley Expands Crypto ETF Push With Low-Cost Ethereum and Solana Funds

Morgan Stanley Investment Management (MSIM) has expanded its digital asset product lineup with the launch of two spot cryptocurrency exchange-traded products (ETPs): the Morgan Stanley Ethereum Trust (NYSE Arca: MSSE) and the Morgan Stanley Solana Trust (NYSE Arca: MSOL).

The new funds began trading on Tuesday, offering investors direct exposure to Ethereum (ETH) and Solana (SOL) through regulated investment vehicles while charging an industry-leading 0.14% annual expense ratio.

The launch follows the firm'sBitcoin ETP introduced earlier this year, which has grown to more than $381 million in assets under management as of July 16. Together, the three crypto ETPs position Morgan Stanley as the first U.S. bank-affiliated asset manager to offer investment products tracking Bitcoin, Ethereum, and Solana.

Lowest Fees in the Category

With an expense ratio of 0.14%, both MSSE and MSOL become the cheapest products in their respective categories, undercutting the previous low-cost Ethereum offering.

Bloomberg Senior ETF Analyst Eric Balchunas noted the aggressive pricing strategy, saying the new products immediately set a new fee benchmark for both Ethereum and Solana investment vehicles.

According to prospectus filings, each trust launched with approximately 50,000 shares and around $1 million in seed capital.

Morgan Stanley's growing ETF platform now manages more than $14 billion across 22 exchange-traded products spanning traditional and digital asset strategies.

Staking Rewards Passed to Investors

A distinguishing feature of the two funds is their staking strategy.

Both trusts intend to stake portions of their crypto holdings to generate additional yield, using Figment, Galaxy Blockchain Infrastructure, and Coinbase Canada as staking providers. Those providers, together with custodians, retain 5% of the gross staking rewards, while Morgan Stanley does not take a share beyond the standard management fee.

The two products, however, differ in how aggressively they stake assets.

• MSOL intends to stake up to 100% of its SOL holdings.

• MSSE plans to stake between 50% and 80% of its Ether holdings, with an 80% maximum allocation.

Staking rewards will be distributed to investors in cash on at least a quarterly basis through the sale of earned tokens.

Ethereum's Validator Queue May Delay Initial Rewards

Although both products incorporate staking, investors in the Ethereum fund may wait longer before receiving rewards.

According to the prospectus, Ethereum's validator activation queue stood at approximately 2.71 million ETH as of early July, translating into an estimated 47-day waiting period before newly staked assets begin earning rewards.

By comparison, Solana's staking process typically requires only two to three days, potentially allowing the Solana fund to begin generating staking income much sooner.

Morgan Stanley said it will publish the percentage of Ethereum assets actively staked on a daily basis.

Institutional Adoption Remains the Bigger Test

While the launch expands institutional access to digital assets, the key question now is whether Morgan Stanley's extensive wealth management network will drive meaningful inflows.

The firm oversees approximately $9.3 trillion in client assets through roughly 16,000 financial advisers, while also recently enabling spot cryptocurrency trading through E*TRADE.

The timing comes as both assets remain well below previous market highs. Ethereum continues to trade roughly 61% below its August 2025 peak, while Solana remains approximately 75% below its January 2025 high.

Whether advisers view current prices as an attractive long-term entry point could ultimately determine whether the success of Morgan Stanley's Bitcoin fund extends to Ethereum and Solana.

"Since introducing our first ETFs in 2023, we've built a diversified suite of ETFs and ETPs that now exceed $14 billion in assets under management," said Ally Wallace, Global Head of ETFs at Morgan Stanley Investment Management.

"The addition of MSSE and MSOL reflects the natural evolution of our product suite, which seeks to provide simplified access to digital assets through the ETP wrapper."

Amy Oldenburg, Head of Digital Asset Strategy at Morgan Stanley, added that digital assets are becoming an increasingly important component of diversified portfolios, with the firm's focus remaining on offering institutional-grade access backed by governance, infrastructure, and risk management.

Morgan Stanley's latest launch reflects intensifying competition among traditional asset managers to capture institutional demand for digital assets. By pairing the industry's lowest fees with staking rewards, the firm is moving beyond simple crypto exposure toward yield-generating investment products. This trend could shape the next phase of institutional adoption if investor flows follow.