What Morgan Stanley filed

Morgan Stanley submitted second-amended S-1 registration statements for two spot crypto ETFs on June 18, 2026 — the Morgan Stanley Ethereum Trust (MSSE), listed for NYSE Arca, and the Morgan Stanley Solana Trust (MSOL). Both carry a unitary sponsor fee of 0.14%, matching the rate Morgan Stanley already charges on its spot Bitcoin ETF, MSBT, which launched in April and has crossed $233 million in AUM.

The headline number matters because 0.14% undercuts every existing competitor in both categories:

But the filings go beyond fees. Both trusts are structured to stake a substantial portion of their holdings and retain 95% of the on-chain rewards inside the fund — a feature that transforms the cost equation for long-term holders.

How the staking structure works

According to the amended S-1, the Ethereum trust intends to stake 50–80% of its ether through three third-party staking providers — Figment, Galaxy Blockchain Infrastructure, and Coinbase Canada. Custody sits with Bank of New York Mellon and Coinbase Custody, with Coinbase also acting as prime broker. The fund tracks the CoinDesk Ether Benchmark.

Of the staking rewards earned, 95% remain in the trust, increasing the fund's net asset value. The remaining 5% is split among staking service providers and custodians as compensation. At current Ethereum staking yields of roughly 3–3.5% annualized, the math looks like this for a $10,000 position staking 65% of holdings (midpoint of the 50–80% range):

• Gross staking yield on staked portion: ~3.25%
• Effective yield on the full fund: ~2.1% (65% × 3.25%)
• After the 5% provider cut: ~2.0%
• Minus the 0.14% sponsor fee: ~1.86% net yield

For comparison, BlackRock's ETHA does not currently stake and charges 0.25%, producing a net yield of −0.25% — the management fee is pure drag. As we detailed in our Ethereum ETF comparison, the fee difference between existing ETH products is small enough that liquidity and custody have been the deciding factors. A staked product that effectively pays investors rather than charging them changes that calculus.

The filing also discloses a practical constraint: approximately 3.64 million ETH sat in the validator activation queue as of May 18, implying a roughly 63-day wait before newly staked ether begins earning rewards. That lag means MSSE's staking yield would ramp gradually after launch rather than appearing on day one.

Why a bank-issued staked ETF matters now

Morgan Stanley is not the first issuer to propose staking inside an ETF wrapper — Bitwise's BSOL has passed through Solana staking rewards since late 2025, accumulating over $860 million in AUM. But MSSE and MSOL are significant for three reasons.

1. Cost leadership from a bulge-bracket bank. Morgan Stanley's MSBT already proved that a major bank can price below crypto-native issuers and attract capital quickly — $100 million in its first week and $233 million within a month. Extending the same 0.14% fee to ETH and SOL signals a strategic commitment to win on cost, not just brand. As we've noted in our guide to expense ratios and liquidity, fee advantages compound meaningfully over multi-year horizons.

2. Custody diversification. Most existing Ethereum ETFs rely on Coinbase Custody exclusively. Morgan Stanley's filing names Bank of New York Mellon as co-custodian alongside Coinbase — the first ETH ETF to split custody between a traditional financial institution and a crypto-native custodian. For risk-conscious allocators, that dual-custodian structure addresses the concentration concern that has been a persistent critique of the current ETF landscape.

3. Timing. The filing landed on the same day that crypto ETFs shed $111 million following Chair Warsh's hawkish FOMC debut. In a rising-rate environment where non-yielding assets face structural headwinds, staking rewards provide a partial hedge — the ETF earns yield even when the spot price trades sideways or dips. The rotation from non-yielding BTC ETFs into yield-bearing SOL products that we've tracked throughout June underscores the growing institutional preference for income-generating crypto exposure.

What it means for investors

Morgan Stanley's amended filings remain under SEC review and do not include a firm launch date. But even before MSSE and MSOL begin trading, the filings reshape the competitive landscape in two concrete ways.

Fee compression is coming. When MSBT launched at 0.14% in April, it forced a conversation about whether BlackRock and Fidelity would eventually match. If MSSE reaches the market at the same rate, existing ETH ETF issuers charging 0.20–0.25% will face pressure to cut fees or add staking — or both. For current holders of ETHA or FETH, the decision to wait or switch will depend on whether incumbents respond before MSSE goes live.

Staking flips the total-cost equation. A 0.14% fee with ~2% net staking yield produces a positive carry. A 0.25% fee with no staking produces negative carry. Over a five-year hold on $50,000, the difference compounds to roughly $5,800 — assuming flat ETH prices and current staking rates. That gap is large enough to drive reallocation even among passive investors who rarely switch funds.

For Pre-Tick users, MSSE and MSOL will be added to our dashboard once they begin trading. In the meantime, our estimation engine continues to price ETHA and existing Solana ETFs using live crypto spot data, giving investors a real-time view of where these funds are heading before the bell.