Morgan Stanley has submitted a Form S-1 registration statement to the U.S. Securities and Exchange Commission outlining the structure of a proposed spot Bitcoin exchange-traded fund called the Morgan Stanley Bitcoin Trust.

According to the filing, the firm plans to use Coinbase Custody and the Bank of New York Mellon (BNY) to safeguard the trust’s Bitcoin holdings. 

The two institutions would act as custodians for the Bitcoin, responsible for secure storage and handling transfers associated with the creation and redemption of ETF shares.

The document describes a custody framework intended to align with established institutional practices. 

Most of the Bitcoin held by the trust would be stored in offline cold storage systems, where private keys remain disconnected from the internet to reduce exposure to cyber threats. 

Some assets could be moved temporarily into trading wallets when shares of the ETF are created or redeemed. 

The filing notes that custody insurance is in place, though coverage is shared among clients and may not protect against every possible loss scenario.

In addition to its role in digital asset custody, BNY would perform several operational functions for the fund. 

The bank is expected to serve as the ETF’s administrator, transfer agent, and cash custodian, managing fund accounting, maintaining shareholder records, and overseeing cash movements tied to ETF activity.

The proposed ETF would be structured as a passive investment vehicle designed to track the market price of Bitcoin. Instead of relying on derivatives or leverage, the trust would hold Bitcoin directly.

Share this article
The link has been copied!