Morgan Stanley Bitcoin ETF trails BlackRock with $30.6 million 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, marking a solid but not blockbuster start in the spot Bitcoin ETF market.

MSBT began trading on the NYSE Arca on Wednesday, generating $34 million in trading volume, slightly above Bloomberg ETF analyst Eric Balchunas’ expectation of $30 million for its first day.

Holdings and fee positioning

As of April 8, MSBT held 444.4 Bitcoin (BTC), valued at about $31.7 million. That represented roughly 0.03% of the estimated 1.29 million BTC held collectively by US spot Bitcoin ETFs.

With the lowest fee among its peers, MSBT trailed only BlackRock’s iShares Bitcoin Trust (IBIT) on the day. IBIT recorded $40 million in inflows, underscoring competition among a small group of large issuers.

Broader flows: inflows offset by outflows

MSBT’s debut inflows were not enough to counter selling elsewhere. According to Farside data, the Fidelity Wise Origin Bitcoin Fund (FBTC) and the ARK 21Shares Bitcoin ETF (ARKB) saw outflows of $79 million and about $75 million, respectively.

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.

Recent trend and context

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

How MSBT compares with 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. In that initial wave, GBTC and IBIT recorded $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.

Outlook for the launch

Despite trailing the earlier launch class, Bloomberg’s Balchunas said Morgan Stanley’s Bitcoin ETF is still on track to be among the top ETF launches from the past year, referencing a $60 million volume threshold. He cited other recent launches including the Bitwise Solana Staking ETF (BSOL), the Canary XRP ETF (XRPC), and the Roundhill Memory ETF (DRAM).