- Morgan Stanley has appointed BNY Mellon and Coinbase Custody to safeguard Bitcoin for its proposed Morgan Stanley Bitcoin Trust ETF.
- Most of the fund’s Bitcoin will be stored offline in cold storage, with smaller amounts moved to hot wallets to facilitate ETF share creation and redemption.
- BNY Mellon will also serve as administrator, transfer agent and cash custodian, while Coinbase will act as the fund’s prime broker.
Morgan Stanley has designated Bank of New York Mellon and Coinbase Custody Trust Company to hold the Bitcoin associated with its proposed Morgan Stanley Bitcoin Trust exchange-traded fund, according to filings made with the US Securities and Exchange Commission (SEC).
The custody arrangement was revealed in an updated S-1 registration document that outlines how the fund will operate. Under the plan, the ETF’s Bitcoin reserves will largely be kept in cold storage systems, meaning the private keys controlling the assets remain offline rather than connected to the internet. A smaller amount may periodically move to hot wallets in order to support the creation and redemption of ETF shares.
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Operational Structure
Both custodians are regulated entities in New York. BNY Mellon holds a charter as a New York state bank, while Coinbase Custody operates as a New York state limited liability trust company. According to the filing, the firms will provide custody services for the digital assets and assist with trade execution tied to the fund’s Bitcoin holdings.
The amended registration statement also clarifies several additional operational responsibilities. BNY Mellon is identified as administrator, transfer agent and cash custodian, while Coinbase will act as the fund’s prime broker.
Morgan Stanley first filed the S-1 registration for the Bitcoin ETF in January but had not disclosed custody partners at that stage. The proposed product aims to track the spot market price of Bitcoin, consistent with the structure used by other Bitcoin exchange-traded funds. Approval from the SEC is still required before the ETF can begin trading.
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