Morgan Stanley wins approval for 2 crypto ETFs on NYSE Arca

NYSE Arca approved Morgan Stanley's spot Solana and Ethereum exchange-traded funds on July 24, clearing the way for the $10 trillion asset manager to offer direct crypto exposure through two ETFs with management fees of 0.14 percent each.

"The approval of these ETFs marks a significant step in bringing regulated crypto investment products to mainstream investors," said a Morgan Stanley spokesperson, confirming the filings had become auto-effective under Section 12(b) of the Exchange Act. The Ethereum ETF will trade under the ticker MSSE and the Solana ETF under MSOL.

Morgan Stanley plans to stake 50 percent to 80 percent of Ethereum holdings through Figment, Galaxy Blockchain and Coinbase Canada, with staking service providers receiving only 5 percent of rewards — the remainder accruing to investors. For Solana, the issuer intends to stake up to 100 percent of holdings through the same providers. The Bank of New York Mellon and Coinbase Custody will serve as custodians for both funds. Morgan Stanley's existing Bitcoin ETF, MSBT, holds over $391 million in total assets and recorded $5 million in inflows during the latest session.

The approvals come as the broader crypto market faces headwinds. Bitcoin traded at $64,988, down 0.95 percent, while Ethereum fell 2.36 percent to $1,880 after failing to break above the $2,000 resistance level. Solana dropped 2.83 percent, testing the $78 support zone. Total liquidations reached $282 million across the market, with $192 million in long positions wiped out, according to Coinglass data. The Fear and Greed Index stood at 28, signaling extreme fear among traders.

Institutional Gateway Opens for Altcoin ETFs

The dual approval establishes a regulatory template for altcoin ETFs on a major US exchange. Morgan Stanley's brokerage arm E*TRADE recently completed the rollout of spot Bitcoin, Ethereum and Solana trading, allowing clients to buy, sell and hold crypto through a linked Zerohash account. The integration suggests the firm is building a full-service crypto offering spanning trading, custody and now ETF products.

Spot Bitcoin ETFs recorded $255.18 million in outflows on July 23, their first day of net withdrawals in seven days, even as Ethereum ETFs posted $26 million in inflows. The divergence highlights shifting institutional preferences as the SEC-approved Ethereum and Solana products expand the menu of regulated crypto investment vehicles beyond Bitcoin.

What the Approvals Mean for Market Structure

The listing of Solana and Ethereum ETFs on NYSE Arca could accelerate capital rotation from Bitcoin-only exposure into diversified crypto portfolios. With management fees set at 0.14 percent — below the industry average for crypto ETFs — Morgan Stanley is positioning the funds as low-cost vehicles for institutional and retail investors alike.

The staking component adds a yield-generating layer absent from most existing crypto ETFs. For Ethereum, the planned 50 percent to 80 percent staking allocation could generate annual yields of 3 percent to 5 percent based on current network staking rates, according to StakingRewards data. Solana's staking yield potential is higher, with current rates near 7 percent, though the protocol's volatility introduces additional risk.

The next milestone for both ETFs is the CERT filing, which will specify the official trading commencement date. Market participants expect trading to begin within weeks, pending final administrative steps.

This article is for informational purposes only and does not constitute investment advice.