Morgan Stanley Launches Low-Fee Ethereum and Solana ETFs

Morgan Stanley Investment Management has launched two exchange-traded products offering indirect exposure to ether and SOL through conventional brokerage accounts.

The Morgan Stanley Ethereum Trust, trading under MSSE, and the Morgan Stanley Solana Trust, trading under MSOL, began trading on NYSE Arca on 28 July. Each carries an expense ratio of 0.14%.

Morgan Stanley Expands Its Crypto ETP Line-up

MSSE tracks ether using the CoinDesk Ether Benchmark 4 PM NY Settlement Rate, while MSOL follows the equivalent CoinDesk benchmark for SOL.

The two products follow the Morgan Stanley Bitcoin Trust, which held more than $381 million in assets under management as of 16 July. Morgan Stanley now manages more than $14 billion across 22 exchange-traded products, including three focused on digital assets.

The launch comes as institutional demand remains sensitive to fund pricing and flows, with Bitcoin recently recovering despite substantial ETF outflows.

Both Trusts Plan to Earn Staking Rewards

MSSE and MSOL intend to stake portions of their holdings to earn blockchain rewards. Morgan Stanley Investment Management said it will not retain any share of those rewards for itself.

Regulatory filings indicate that MSOL may stake up to 100% of its SOL under normal market conditions, although the trust may keep assets unstaked to meet redemptions, expenses and liquidity requirements.

Figment, Galaxy Blockchain Infrastructure and Coinbase Canada are listed as staking service providers for the Solana trust. Provider charges and operating costs will reduce the rewards ultimately available to investors.

The structure reflects growing institutional participation in proof-of-stake networks, including MoneyGram’s move into Solana validator infrastructure.

IRS Safe Harbour Supports the Structure

Revenue Procedure 2025-31 created a federal tax safe harbour allowing qualifying investment and grantor trusts to stake proof-of-stake digital assets without losing their trust classification.

The measure does not make staking income tax-free. Rewards may still create taxable income for shareholders, depending on their individual circumstances.

The launch also comes as policymakers continue to debate a broader US regulatory framework for digital assets.

Investors Still Face Crypto and Staking Risks

The products provide indirect exposure rather than ownership of ether or SOL. Investors do not control private keys or interact directly with either blockchain.

They also remain exposed to cryptocurrency volatility, tracking differences, liquidity constraints, custodian failures and staking risks such as validator penalties or slashing. Morgan Stanley warns that investors could lose their entire investment.