On Wednesday, Morgan Stanley launched the first spot Bitcoin ETF by a major U.S. commercial bank, with its MSBT product seeing an inflow of $30.6 million on its debut trading day, as reported by Farside Investors. Despite this promising start, Wednesday saw a second consecutive day of net outflows from spot Bitcoin ETFs, amounting to $124.5 million in withdrawals. However, these funds have accumulated gains throughout the week due to a substantial $471 million inflow on Monday, marking their largest single-day gain since February.
The MSBT ETF boasts an expense ratio of 0.14%, making it the most cost-effective Bitcoin ETF available and undercutting BlackRock’s IBIT by 11 basis points. This move intensifies competition with BlackRock’s IBIT, which currently manages $56 billion in assets and has an annual fee of 0.25%. On Wednesday alone, IBIT attracted $40.4 million.
James Seyffart from Bloomberg Intelligence suggested that MSBT might function as a ‘loss leader,’ indicating it could attract crypto-rich investors to Morgan Stanley’s wealth management services. Eric Balchunas, a colleague at Bloomberg Intelligence, described the launch in a tweet as the ‘arguably biggest BTC launch since they began’ and estimated first-year assets under management could reach $5 billion.
Earlier this week, Balchunas shared with Decrypt that while Morgan Stanley’s ETF may not surpass BlackRock to become the largest, it is anticipated to perform well due to its established network of advisors. According to CoinGecko data, Bitcoin was trading at $71,260 on Wednesday, down by 0.6% for the day yet up 6.6% over the week. On Myriad’s prediction market, owned by Decrypt’s parent company Dastan, users are evenly divided about Bitcoin’s future direction, forecasting equal chances of its next movement reaching either $84,000 or dropping to $55,000.