Morgan Stanley has updated its proposed Ethereum and Solana exchange traded funds to include staking, offering investors potential on chain rewards alongside direct exposure to the two cryptocurrencies.
Key Takeaways
- Morgan Stanley filed amended S 1 registrations for its proposed Ethereum and Solana ETFs.
- Both funds would charge a 0.14% annual sponsor fee, making them among the lowest cost products in their categories.
- The ETFs plan to stake a portion of their crypto holdings, with 95% of staking rewards remaining in the funds.
- The filings provide new details on Ethereum staking delays, validator operations, and potential risks.
What Happened?
Morgan Stanley has submitted updated filings to the U.S. Securities and Exchange Commission for its proposed Ethereum and Solana exchange traded funds. The amendments introduce staking functionality, allowing the funds to generate additional yield from their crypto holdings while maintaining spot market exposure.
The filings also reveal fee structures, staking reward allocations, and operational details that provide a clearer picture of how the products would function if approved.
NEW: @MorganStanley just filed amendments for both their Ethereum and Solana ETFS. ethereum:native solana:So11111111111111111111111111111111111111112 pic.twitter.com/SxPiszp9RS
— James Seyffart (@JSeyff) June 18, 2026
Morgan Stanley Expands Its Crypto ETF Strategy
The latest filings mark another step in Morgan Stanley’s broader push into digital asset investment products. The bank entered the spot Bitcoin ETF market earlier this year, and its Bitcoin fund has already attracted significant investor interest.
According to the filing, Morgan Stanley’s Bitcoin ETF has accumulated approximately $300.7 million in cumulative net inflows as of June 18. Building on that momentum, the company is now seeking to expand into both Ethereum and Solana investment products.
The proposed funds would trade under the ticker symbols MSSE for the Ethereum Trust and MSOL for the Solana Trust.
Industry observers view the amended filings as a sign of ongoing engagement between Morgan Stanley and SEC staff as the regulatory review process continues.
Low Cost Fees Could Increase Investor Appeal
One of the most notable details in the amended filings is the pricing structure.
Both the Morgan Stanley Ethereum Trust and Morgan Stanley Solana Trust would charge a 0.14% annual sponsor fee. The fee would be calculated daily based on each fund’s net asset value and paid monthly.
The proposed fee is lower than several competing products currently available in the market. For comparison:
- Grayscale Mini Ethereum Trust charges 0.15%.
- Franklin Templeton’s Solana ETF charges 0.19%.
The sponsor will not receive any share of staking rewards beyond the standard management fee, a structure designed to keep most staking generated income within the funds.
Staking Rewards Will Primarily Benefit Investors
A major addition in the updated filings is the inclusion of staking.
Under the proposed structure, both ETFs will stake a portion of their underlying crypto assets to generate additional returns.
Morgan Stanley disclosed that staking service providers and custodians will collectively receive 5% of staking rewards as compensation for their services. The remaining 95% of rewards will stay within the funds, potentially increasing returns for shareholders.
This approach allows investors to gain exposure not only to price movements in ETH and SOL, but also to staking income generated directly from the underlying blockchain networks.
The filings identify Figment Inc., Galaxy Blockchain Infrastructure, and Coinbase Canada as staking service providers for the proposed products.
Ethereum Filing Reveals Staking Queue Challenges
The Ethereum filing provides extensive detail about how staking will operate.
According to the document, custodians will deposit ETH held by the fund into Ethereum staking smart contracts, while third party staking providers will operate validators on behalf of the trust.
The filing also highlights the risk of slashing, a process that can penalize validators that fail to perform required duties or violate network rules. In such cases, a portion of staked ETH could be forfeited.
Morgan Stanley further disclosed data related to Ethereum’s validator activation queue. As of May 18, 2026, approximately 3.64 million ETH were waiting to be activated for staking.
Because Ethereum currently limits validator activation to as many as 56 validators per epoch, only about 57,600 ETH can enter staking each day.
Based on these network conditions, newly staked ETH may need to wait approximately 63 days before becoming eligible to earn staking rewards.
Solana Trust Uses Similar Structure
The proposed Solana ETF follows a comparable staking model.
Validators operated by staking service providers would act as delegated validators for the trust’s staked SOL. Unlike the Ethereum filing, however, the Solana amendment does not disclose any daily staking capacity limits.
Morgan Stanley also stated that custodians involved in the staking process will not control the private keys associated with delegated SOL assets.
CoinLaw’s Takeaway
In my experience, the most important aspect of these filings is not the fee reduction alone but the inclusion of staking. Crypto ETF issuers have been searching for ways to make their products more attractive than simple price tracking vehicles, and staking provides a clear path to additional yield.
I found the 95% reward retention structure particularly investor friendly because it allows most staking income to remain inside the fund. If regulators ultimately approve these products, they could become an important template for the next generation of crypto ETFs in the United States.
