TL;DR
- Morgan Stanley filed an S-1 with the SEC to launch a spot Ethereum ETF with staking, structured as MSET and backed by ETH held on the balance sheet.
- The fund will allocate a portion of its ETH to staking and reflect the rewards in the NAV, without distributing staking income directly to shareholders.
- The firm had already filed for spot Bitcoin and Solana ETFs.
Morgan Stanley filed with the SEC to launch a spot Ethereum ETF with a staking component. The registration was submitted through an S-1 form and proposes the creation of the Morgan Stanley Ethereum Trust, a vehicle that would hold ETH on its balance sheet and track its market price.
The defining feature of the product lies in its staking structure. The fund plans to allocate part of its ETH holdings to staking and reflect the resulting rewards directly in the net asset value (NAV). There will be no direct distribution of staking income to shareholders. This structure sets it apart from other Ethereum ETF issuers that chose to pass staking returns explicitly to investors.
Morgan Stanley Has Three Crypto ETF Filings
The Ethereum filing came just 24 hours after Morgan Stanley submitted applications to launch spot Bitcoin and Solana ETFs. Within that time frame, the bank accumulated three crypto-related filings. This is an unusual sequence for an institution of this size and points to a concrete expansion of its crypto product offering.
Morgan Stanley is one of the largest wealth managers globally and the sixth-largest U.S. bank by assets under management. Bloomberg Intelligence analysts noted that the initial Bitcoin and Solana filings were unexpected, both in terms of timing and the speed with which Ethereum was added to the lineup.
Activity in the crypto ETF market remains strong. Since their launch in early 2024, U.S. spot Bitcoin ETFs have surpassed $2 trillion in cumulative trading volume. These products have become the primary channel for institutional access to Bitcoin.
ETH Funds Manage Over $20 Billion
The Ethereum segment is smaller, but it already shows a meaningful base. Spot ETH ETFs hold around $20,000 million in assets under management, according to data from SoSoValue. The inclusion of staking in new proposals has become a key variable in this market.
Morgan Stanley has set limits on crypto exposure for certain portfolios and is working to expand access to these products across client accounts, including retirement plans
