Morgan Stanley’s Bitcoin ETF Poised to Attract $160 Billion In New Money, Usurping BlackRock’s IBIT ⋆ ZyCrypto

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Phong Le, President and CEO of Strategy, the world’s largest Bitcoin treasury company, estimates that Morgan Stanley’s proposed Bitcoin ETF could attract as much as $160 billion in demand if investors commit a small portion of their portfolios.

In October 2025, investment banking giant Morgan Stanley suggested a 0% to 4% allocation to crypto for investor portfolios and authorized its financial advisors to recommend crypto funds to clients holding IRAs and 401(k) accounts.

“Morgan Stanley Wealth Management oversees about $8 trillion in AUM and recommends 0–4% Bitcoin allocation,” Le opined. “A 2% allocation would represent $160 billion, ~3X the size of IBIT. $MSBT: Monster Bitcoin.”

Put simply, the Strategy exec estimates that if just 2% of Morgan Stanley’s $8 trillion in client assets were allocated to Bitcoin, it could funnel roughly $160 billion into the cryptocurrency—far larger than current ETFs like BlackRock’s iShares Bitcoin Trust.

The remark comes as Morgan Stanley moves forward with plans for its own spot Bitcoin ETF under the ticker MSBT, sharing additional details in an amended filing with the U.S. Securities and Exchange Commission.

The S-1 filing indicates that the trust aims to raise $1 million by selling 50,000 initial seed shares to its designated sponsor ahead of its NYSE Arca listing, with the proceeds intended to purchase Bitcoin for MSBT. Morgan Stanley noted that the ETF is still pending regulatory approval before trading can commence.

Morgan Stanley had initially indicated that The Bank of New York Mellon and Coinbase Custody Trust Company would safeguard the fund’s assets, with Fidelity now joining as an additional custodian, signaling growing institutional backing.

Traditional Finance Moves Into Crypto

Morgan Stanley’s upcoming Bitcoin ETF is part of a wider effort by major U.S. financial institutions to broaden access to crypto-related products.

On January 5, 2026, Bank of America, the nation’s second-largest bank, began allowing advisors in its wealth management division to recommend four Bitcoin ETFs to clients—a service that had previously been available only on request.

Last December, Vanguard, the world’s second-largest asset manager, opened crypto ETF trading to its clients, reversing its prior anti-crypto position on digital asset ETFs.