Morgan Stanley launched spot Ethereum and Solana exchange-traded funds on Tuesday. Both products entered the market with the lowest management fees in their respective categories.
Both funds charge a 0.14% fee
The company’s Ethereum fund trades under the ticker MSSE, while its Solana fund trades as MSOL on the New York Stock Exchange. Both charge a sponsor fee of 0.14%.
According to SoSoValue data, this rate is lower than the 0.15% charged by Grayscale’s Mini Ethereum Trust and the 0.19% fee attached to Franklin Templeton’s Solana ETF.
The difference may look small on paper, but it can create substantial cost savings over time for funds managing billions of dollars. It is easy to see why institutional investors pay close attention to differences of just a few basis points; small percentages stop looking small when applied to large amounts of capital.
Fee competition has become an increasingly important factor in the ETF industry in recent years. New market entrants often use lower fees to gain an initial advantage before building a broader customer base.
Bitcoin fund reached $400 million despite the bear market
Bloomberg senior ETF analyst Eric Balchunas said Morgan Stanley’s previously launched spot Bitcoin ETF attracted approximately $400 million within four months, despite entering the market during a downtrend. The figure may appear modest at first glance, but the broader market conditions make it more significant.
Morgan Stanley Global Head of ETFs Ally Wallace said the company has built a product lineup exceeding $14 billion since its first launches in 2023. MSSE and MSOL form part of that expansion.
According to Wallace, the company aims to simplify access to digital assets through an exchange-traded product structure.
Staking adds another source of returns
A portion of the ETH and SOL held by the funds will be staked to generate additional yield. This feature sets the products apart from conventional ETFs that only track the price of their underlying assets, while reflecting an approach increasingly adopted by other issuers.
For investors, staking introduces an additional layer of potential returns beyond price appreciation. The feature could prove particularly attractive to those planning to hold their positions over the long term.
Competition intensifies in the altcoin ETF market
The launch comes roughly two and a half years after industry giants such as BlackRock and Fidelity introduced their first spot Bitcoin ETFs. Since then, funds linked to tokens including XRP and HYPE have also entered the market.
As of last week, Solana and Hyperliquid ETFs accounted for approximately 80% of ETF trading volume outside Bitcoin and Ethereum. The combined assets held by Solana ETFs had also surpassed $900 million.
Investor demand currently appears concentrated around these two assets. How much Morgan Stanley’s low-fee strategy will alter the competitive balance remains to be seen.
