Phong Le, President and CEO of MicroStrategy, the world's largest institutional holder of Bitcoin, recently shared his views on Morgan Stanley's (MS) application for a spot Bitcoin ETF. He predicts that if institutional portfolios diversify moderately, the Bitcoin market could see up to $160 billion in new investment demand.
Morgan Stanley's ETF Plans and Institutional Interest
As a financial giant managing $8 trillion in assets, Morgan Stanley is preparing to launch a spot Bitcoin ETF under the ticker symbol “MSBT.” According to regulatory filings, the fund will initially consist of units representing 10,000 shares, with a base share of 50,000 shares during the launch phase.
Pong Le emphasized that allocating just 2% of institutional portfolios to Bitcoin could generate approximately $160 billion in potential demand. This figure is nearly three times the size of one of the largest spot Bitcoin ETFs currently on the market—the iShares Bitcoin Trust.
Fund Structure and Service Providers
The fund's application documents detail a unit-based share creation mechanism, with initial funding close to $1 million. The bank also revealed that it has purchased two shares this month as part of its oversight and regulatory compliance before the official launch.
Investor Appeal and Industry Impact
Pong Le noted that institutional acceptance of Bitcoin is expected to bring significant capital inflows to the entire digital asset industry. Morgan Stanley's portfolio management division suggests that the allocation to Bitcoin can be adjusted between 0% and 4% based on clients' risk tolerance.
“Morgan Stanley's wealth management division manages $8 trillion in assets and recommends allocating between 0% and 4% to Bitcoin. A 2% allocation equates to $160 billion. MSBT could symbolize this potential,” Le added.
As of 2024, the spot Bitcoin ETFs listed in the U.S. have attracted over $50 billion in investments. However, the adoption rate among clients varies due to internal policies and specific client needs.
With the launch of this product, Morgan Stanley will provide its clients with a direct investment channel into a spot Bitcoin ETF, potentially enhancing its influence in the growing digital asset market. Meanwhile, the U.S. Securities and Exchange Commission (SEC) has yet to announce a clear timeline for product approval, leaving the final outcome uncertain.