Morgan Stanley launches Ether, Solana ETPs with staking

Morgan Stanley launched the Morgan Stanley Ethereum Trust (MSSE) and the Morgan Stanley Solana Trust (MSOL) on NYSE Arca on July 28. Each product carries an annual fee of 0.14% and will stake portions of its cryptocurrency holdings, with any staking rewards credited back to the trusts.

The firm stated it will not retain staking rewards and expects to stake less than the trusts’ full holdings to limit exposure to staking-specific risks. Staking generates network rewards for supporting transaction validation. Staked assets can be temporarily unavailable during network entry and exit windows, and validator errors can lead to penalties known as slashing.

At a 0.14% expense ratio, the two products launched at lower fee levels than existing ether and solana funds. Morgan Stanley’s exchange-traded product business manages about $14 billion across 22 products and the firm has roughly 16,000 financial advisers who can offer the trusts to clients. The Morgan Stanley Bitcoin Trust had accumulated more than $400 million in cumulative net flows by July 27.

A market analyst described the launches as the most significant ether and solana fund debuts since the first such products entered the market, citing Morgan Stanley’s adviser network and distribution reach.

In the announcement, Amy Oldenburg, Morgan Stanley’s head of digital asset strategy, wrote that client demand for digital assets is growing and the bank aims to provide a range of digital asset solutions to help investors diversify across traditional and decentralized assets.

The trusts trade on an exchange like other ETPs, offering exposure to ether and solana without requiring direct token custody. Each trust’s prospectus details how staking will be conducted, any potential lockup periods and the operational safeguards the firm will use to limit validator errors and slashing.