Morgan Stanley submitted SEC filings this week for two new spot ETFs tracking Ethereum and Solana, each carrying a 0.14% annual expense ratio. ETF analyst Eric Balchunas called the rate "the cheapest in [the] US and world," marking a sharp move downward in a market where fee compression has been steady since bitcoin and ethereum spot ETF approvals last year.
The 0.14% fee undercuts the current floor for ethereum spot ETFs by roughly 15 basis points. Solana has no U.S. spot ETF yet, so Morgan Stanley would establish the opening price if approved. For context, ethereum spot ETFs currently trade between 0.19% and 0.25% depending on issuer, while bitcoin spot products range from 0.19% to 0.25%. The filing suggests Morgan Stanley sees fee wars as the main lever for differentiating new crypto ETF products in an increasingly crowded field.
The move mirrors traditional asset management, where scale and operational efficiency eventually compress margins across similar offerings. Early movers in spot crypto ETFs captured premium pricing; followers now compete on cost. A 0.14% ethereum ETF would make regular traders more indifferent to which issuer they choose, favoring whoever lands the filing approval fastest.
Solana's position here is notable. The token ranks seventh by market capitalization at roughly $80.1, well below ethereum's $1,643 spot price and number-two ranking. A Solana spot ETF represents untested demand at scale. Morgan Stanley's willingness to absorb the cost of entry suggests confidence that volume will eventually justify the bet, or that the marketing value of "cheapest Solana ETF in the world" justifies near-zero margin initially.
The SEC has signaled openness to spot crypto ETFs following last year's approvals, but no timeline is guaranteed. Morgan Stanley's filings now enter the queue alongside other pending crypto ETF applications. Approval timing depends on the agency's review pace and whether competitors file lower-fee alternatives in the interim, which would restart the compression cycle yet again.