Morgan Stanley has amended its proposed Ethereum and Solana ETF filings with the Securities and Exchange Commission, revealing a 0.14% annual sponsor fee and a staking structure that would pass 95% of network rewards back to investors. The S-1/A disclosures, filed this week, show the bank is still working through SEC feedback — these aren't approvals yet. But the documents give the clearest look yet at how Wall Street plans to package proof-of-stake crypto into retail ETFs.
Fee positioning
The 0.14% fee lands near the low end of the crypto ETF cost spectrum. For comparison, most spot Bitcoin ETFs launch between 0.19% and 0.25% before waivers. Morgan Stanley isn't leading with a zero-fee gimmick — it's playing the long game, betting that brand and the staking yield will attract assets. The fee alone won't make or break these funds, but it signals that the bank sees a crowded field ahead and wants to compete on price from day one.
Staking mechanics and risks
The staking language is the real differentiator. Under the plan, 95% of staking rewards stay inside the trust for investors; the remaining 5% goes to staking service providers and custodians. That split is aggressive compared to some earlier ETF staking proposals, which handed a bigger cut to operators.
But staking isn't free lunch. The filings flag operational, regulatory, tax, liquidity, and slashing risks. Slashing — where a validator loses funds for misbehavior — is a real possibility. The ETF structure has to account for that. Tax treatment of staking rewards inside a trust is murky, too. The SEC hasn't signed off on any of this yet, which is why the S-1/A is still an amendment, not a final prospectus.
The new competitive landscape
Bitcoin ETFs competed mainly on cost, brand, liquidity, and custody. Ethereum and Solana add a whole new variable: staking. Suddenly, an ETF's total return isn't just about the spot price — it's about yield. That changes how fund sponsors design products and how investors compare them.
Morgan Stanley's filing shows Wall Street's growing hunger for crypto ETF assets beyond Bitcoin. The bank is betting that a low fee plus most of the staking yield will be enough to pull in inflows. Whether investors agree depends on how the SEC handles the staking question — and whether the regulator lets these funds launch at all.
The clock is ticking. The SEC has a formal review window for the underlying 19b-4 proposals, and the S-1 amendments suggest both sides expect a decision this summer.
