Morgan Stanley Bitcoin ETF trails BlackRock with $30M in first-day inflows

The Morgan Stanley Bitcoin Trust (MSBT), the first spot Bitcoin exchange-traded fund (ETF) offered by a US bank, recorded $30.6 million in inflows on its trading debut, giving the Wall Street bank a respectable, but not blockbuster, entry into the spot Bitcoin ETF market.

MSBT started trading on the NYSE Arca on Wednesday, generating $34 million in trading volume, slightly above the expectations of Bloomberg ETF analyst Eric Balchunas, who predicted first-day volume would reach $30 million.

As of April 8, MSBT held 444.4 Bitcoin (BTC), worth around $31.7 million, accounting for roughly 0.03% of the estimated 1.29 million BTC collectively held by US spot BTC ETFs.

Offering the lowest fee among its peers, Morgan Stanley’s ETF trailed only BlackRock’s iShares Bitcoin Trust (IBIT) on the day, which saw $40 million in inflows, highlighting competition in a market dominated by a few large issuers.

The debut matters less as a challenge to BlackRock than as a sign that traditional finance still sees room in Bitcoin ETFs, but Morgan Stanley is arriving two years late to a market where the 2024 launch class set a far higher bar for first-day demand.

Total Bitcoin ETF flows negative amid outflows from FBTC and ARKB

IBIT and MSBT’s inflows were not enough to offset selling from other funds, as the Fidelity Wise Origin Bitcoin Fund (FBTC) and the ARK 21Shares Bitcoin ETF (ARKB) saw outflows of $79 million and about $75 million, respectively, according to Farside data.

The Grayscale Bitcoin Trust ETF (GBTC) added another $11 million in redemptions, bringing total daily outflows from US spot Bitcoin ETFs to $124.5 million.

Source: Farside

The outflows marked two consecutive days of selling, following Tuesday’s $159 million in outflows, after the funds recorded $471 million in inflows on Monday, the largest daily inflows since late February.

Related: Canary Capital submits application for US-based spot PEPE ETF

MSBT trails the 2024 launch wave

MSBT’s debut was modest compared with the January 2024 launch wave that followed the Securities and Exchange Commission’s approval of the first US spot Bitcoin ETFs.

GBTC and IBIT handled $2.3 billion and $1 billion in opening day volume, respectively. IBIT saw about $112 million in inflows on its first day, while GBTC recorded $95 million in outflows.

Although trailing, Morgan Stanley’s Bitcoin ETF is still on track to be among the top ETF launches in the past year, according to Bloomberg’s Balchunas.

Source: Eric Balchunas

The ETF analyst referred to funds such as the Bitwise Solana Staking ETF (BSOL), the Canary XRP ETF (XRPC) and the Roundhill Memory ETF (DRAM), highlighting a $60 million volume threshold.

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