Morgan Stanley adds staking incentive to Ethereum, Solana ETFs
Morgan Stanley has updated its proposed Ethereum and Solana exchange-traded funds with a staking structure that would allow 95% of staking rewards to remain within the trusts while charging a 0.14% annual sponsor fee.
- Morgan Stanley amended its Ethereum and Solana ETF filings to include staking and a 0.14% annual fee.
- The proposed structure would keep 95% of staking rewards inside the trusts, with 5% paid to service providers.
- Ethereum filing data shows a 3.64 million ETH validator queue, implying a staking activation wait of about 63 days.
According to amended S-1 registration statements filed by Morgan Stanley, both the Morgan Stanley Ethereum Trust and Morgan Stanley Solana Trust would stake portions of their underlying crypto holdings to generate additional income for investors.
The filings disclosed that staking service providers and custodians would receive 5% of staking rewards as compensation, while the remaining 95% would stay in the funds.
Under the proposed structure, Morgan Stanley stated that the sponsor would not receive any staking rewards beyond the management fee. The filings indicate that staking income would accrue to the trusts rather than being redirected to the fund sponsor.
The amendments represent another step in Morgan Stanley’s efforts to expand its digital asset product lineup after entering the spot Bitcoin ETF market earlier this year.
Ethereum filing outlines validator limits and staking delays
Details included in the Ethereum filing provide a closer look at how the staking process would operate. According to Morgan Stanley, custodians would deposit ETH held by the trust into Ethereum staking smart contracts, while third-party staking service providers would operate validators on behalf of the fund.
The filing noted that staked Ether remains exposed to slashing penalties if validators fail to meet network requirements or violate protocol rules. In such cases, a portion of staked ETH could be removed from a validator’s balance.
Morgan Stanley also disclosed network capacity data tied to Ethereum staking. According to the filing, approximately 3.64 million ETH were waiting in the validator activation queue as of May 18, 2026.
The document stated that Ethereum currently limits validator activations to 56 validators per epoch, which translates to roughly 57,600 ETH entering staking each day. Based on those figures, Morgan Stanley estimated that newly staked ETH could face a waiting period of around 63 days before becoming eligible to earn staking rewards.
While the filing focused on operational details, the disclosures come as asset managers continue working with U.S. regulators on ETF structures that incorporate staking alongside direct crypto exposure.
Solana trust follows similar reward-sharing model
A separate amendment for the Morgan Stanley Solana Trust described a similar staking arrangement for SOL holdings. According to the filing, validators operated by staking service providers may act as delegated validators for the trust’s staked assets.
Morgan Stanley stated that custodians involved in the staking process would not control the private keys associated with delegated SOL. Unlike the Ethereum filing, however, the Solana amendment did not specify a daily limit on how much SOL could enter staking.
The filings arrive as Morgan Stanley continues adding crypto-related services across its wealth management division. As previously reported by crypto.news, Morgan Stanley Wealth Management recently partnered with Galaxy Digital to allow eligible high-net-worth clients to convert digital asset holdings into spot crypto investment products through a referral arrangement.
According to the companies, clients can lend assets including Bitcoin, Ether, and Solana to Galaxy Digital and receive shares in regulated crypto investment products, including the recently launched Morgan Stanley Bitcoin Trust.
The firms said the process can reduce crypto-to-ETP onboarding times by as much as 75% while allowing investors to maintain market exposure without first selling their digital assets.
Taken together, the ETF amendments and the Galaxy Digital arrangement add new crypto investment channels for Morgan Stanley clients as the bank continues building products tied to Bitcoin, Ethereum, and Solana through regulated investment structures.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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