Morgan Stanley’s spot Bitcoin ETF has reached $103 million in net inflows within weeks of launch. The early traction signals continued institutional demand despite an increasingly crowded ETF market.
The Morgan Stanley Bitcoin Trust (MSBT) added $19.3 million in inflows on Wednesday, according to Farside Investors data. Launched on April 8, the fund charges a 0.14% fee, slightly undercutting the Grayscale Bitcoin Mini Trust. MSBT has now surpassed the WisdomTree Bitcoin Fund (WBTC), which has accumulated $86 million since January 2024.
Can Fee Compression Sustain ETF Competition?
MSBT enters a market dominated by larger players. BlackRock’s iShares Bitcoin Trust (IBIT) leads with $64.3 billion in net inflows, while Fidelity’s Wise Origin Bitcoin Fund holds $10.9 billion. Smaller funds, including Franklin ($375 million), Valkyrie ($326 million), and Invesco Galaxy ($245 million), still maintain a sizable lead over newer entrants.
The rapid rise of MSBT comes as ETF lifespans are shortening across the industry. Bloomberg data shows the average ETF duration declined to 3.5 years in 2025 from 4.66 years in 2024. More than 40 ETFs were liquidated in early 2026 alone, with an average lifespan of just 21 months, though none were major crypto-linked products.
Bloomberg ETF analyst James Seyffart said in December that many crypto exchange-traded products could face closure by 2027 due to insufficient demand. At the time, the U.S. Securities and Exchange Commission (SEC) was reviewing over 126 pending crypto ETF applications, increasing the risk of market saturation.
I'm in 100% agreement with @BitwiseInvest here. I also think we're going to see a lot of liquidations in crypto ETP products. Might happen at tail end of 2026 but likely by the end of 2027. Issuers are throwing A LOT of product at the wall -- there's at least 126 filings https://t.co/eOmeUIKXFZ pic.twitter.com/UELUKUng7Y
— James Seyffart (@JSeyff) December 17, 2025
Still, early inflows suggest selective demand persists for competitively priced products. The next catalyst will be whether MSBT can maintain momentum against established funds as fee pressure intensifies and additional crypto ETFs enter the pipeline.
