[DigitalToday reporter Jinju Hong (홍진주)] Morgan Stanley, a major U.S. investment bank, is making a full entry into the market by directly launching its own bitcoin spot ETF. Attention is on whether low fees and its advisory network will change the existing competition among ETFs.

According to blockchain media outlet BeInCrypto on April 7 local time, Morgan Stanley's bitcoin ETF, the Morgan Stanley Bitcoin Trust (MSBT), will list on NYSE Arca. Trading will begin on the night of April 8, Korea time.

The listing is significant as the first case of a major bank directly launching an ETF under its own name, rather than simply selling products. Morgan Stanley manages more than $6 trillion in client assets through about 16,000 financial advisers, prompting expectations that the listing could mean more than a single product launch in terms of distribution and inflows.

Markets broadly divide key indicators for gauging early performance into 5 categories. Trading volume is the first indicator to confirm initial demand. When U.S. bitcoin spot ETFs listed in January 2024, combined first-day trading value reached about $4.6 billion. If MSBT, as a single ETF, records $500 million to $1 billion in trading, it could be seen as a meaningful start. More active trading would be interpreted as a sign that Morgan Stanley's distribution network is translating into actual buying.

The second indicator is any divergence between market price and net asset value (NAV). New ETFs can trade at a premium early on if expectations run ahead. If MSBT's price moves without a large gap to NAV, it could be interpreted as smooth market-making and backed by institutional participation. If a discount persists, it would mean initial demand is weaker than expected.

The third is fee competition. MSBT at 0.14 percent is 0.01 percentage point lower than Grayscale Bitcoin Mini Trust at 0.15 percent and differs by 0.11 percentage point from BlackRock's iShares Bitcoin Trust (IBIT) at 0.25 percent. Bitcoin spot ETFs offer nearly the same price exposure, highlighting that cost differences can change fund flows over the long term.

Fourth, the market is focusing not so much on bitcoin price moves themselves as on advisers' initial portfolio allocation. Morgan Stanley advisers are known to have recommended allocating 2 to 4 percent of crypto holdings for some clients. If that ratio is reflected in actual portfolios, sizable inflows could occur, some forecasts show.

Finally, first-day net inflows are also important. MSBT will start with about $1 million in seed capital. If initial creations rise quickly, it could confirm meaningful demand coming through the advisory network. If inflows are limited, it could raise the possibility that demand is already entrenched in existing ETFs.

Separately, Morgan Stanley is also pushing to introduce spot trading in bitcoin, ether and solana through E*TRADE, along with plans to launch a solana trust. Its wealth management division described direct crypto trading as the tip of the iceberg and signalled plans to expand into custody, wallets and tokenised assets.