Morgan Stanley Taps Coinbase and BNY for Proposed Spot Bitcoin ETF Custody

Morgan Stanley's proposed spot Bitcoin exchange-traded fund (ETF) has taken another step forward, filing an amended registration statement with the US Securities and Exchange Commission. The Morgan Stanley Bitcoin Trust would hold Bitcoin directly, rather than gaining exposure through derivatives or leverage.

The trust's Bitcoin holdings would be stored in offline cold-storage vaults, keeping private keys disconnected from the internet to reduce cyber threats. A portion of assets may move to trading wallets during share creation or redemption periods.

Custody insurance is maintained but shared across multiple clients and may not cover all potential losses. The fund's daily pricing would use the CoinDesk Bitcoin Benchmark 4PM New York Settlement Rate, which aggregates trade data from major spot exchanges.

The trust's dual-custodian arrangement mirrors institutional standards used by other large asset managers entering the spot Bitcoin ETF space. Coinbase Custody Trust Company and BNY have been named as the fund's Bitcoin custodians.