Morgan Stanley raised its reported stake in BlackRock's spot Bitcoin ETF by 23% during the second quarter, according to a regulatory filing. The bank now holds approximately 16.5 million shares of the iShares Bitcoin Trust (IBIT), up from about 13.4 million shares at the end of Q1.

The filing, submitted as a combined Form 13F covering multiple affiliated managers, showed the IBIT position valued at $549 million as of June 30. That represents a decline of nearly 18% from the prior quarter's $667 million valuation, reflecting Bitcoin's price drop during the three-month period.

New Bitcoin Fund and Expanded Crypto Exposure

Morgan Stanley also reported a new position in its own Bitcoin fund, the Morgan Stanley Bitcoin Trust (MSBT), which began trading on NYSE Arca on April 8. The fund holds 2.57 million shares valued at approximately $43.3 million and charges a 0.14% annual management fee, below the 0.25% fee of both BlackRock's IBIT and Fidelity's Wise Origin Bitcoin Fund.

Despite launching its own product, Morgan Stanley's IBIT position remained more than 12 times larger than its MSBT holding at the end of June. The bank also increased positions in the Grayscale Bitcoin Mini Trust ETF, the Bitwise Bitcoin ETF, and Fidelity's Wise Origin Bitcoin Fund, which rose by nearly 38%.

Ether exposure grew significantly during the quarter. Morgan Stanley increased its holding in BlackRock's iShares Ethereum Trust ETF by about 202% to roughly 4.6 million shares, and raised its Grayscale Ethereum Staking Mini ETF position by approximately 26% to 5.1 million shares. New Solana positions included about $4.25 million in the Grayscale Solana Staking ETF and $2.26 million in the Fidelity Solana Fund.

The bank also expanded its crypto-related equity holdings. Its reported position in Circle Internet Group, the issuer of USDC, increased from about 1.46 million shares to approximately 8.32 million shares, a more than fivefold increase. Additions were also made to Cipher Digital, Core Scientific, Hut 8, and Bitdeer Technologies.

Not all crypto positions increased. Morgan Stanley reduced its Coinbase holding by about 550,000 shares and cut its CleanSpark position by more than 3.1 million shares. Bitfarms was removed from the portfolio entirely after holding roughly 8 million shares in the prior quarter.

The Form 13F provides a quarter-end snapshot of certain U.S.-listed securities and does not disclose every transaction, short positions, or whether all reported shares represent proprietary investments by Morgan Stanley itself. The filing also does not capture price changes or portfolio adjustments made after June 30.