Morgan Stanley vs. BlackRock, Fannie Mae Blesses Bitcoin, & the End of DATs
Timestamps:
00:55 Morgan Stanley Enters the Bitcoin ETF Race
09:53 The Implications of Morgan Stanley's Strategy
21:23 Coinbase's Bitcoin-Backed Mortgages
28:59 Stablecoin Clarity Act and Market Dynamics
32:51 The Future of Banking in Crypto
34:08 Market Dynamics and IPO Insights
38:02 Legal Challenges in the Crypto Space
42:30 The Evolution of Bitcoin as a Treasury Asset
45:52 AI's Impact on the Financial Sector
50:43 Square's Bitcoin Payment Innovations
54:14 Tether's Audit and Market Trust
56:44 The Role of AI in Business Growth
01:00:31 Long-Term Thinking in a Short-Term Market
On this week's Final Settlement, Morgan Stanley launched MSBT at 14 basis points, the cheapest spot Bitcoin ETF on the market and the first issued by a bank. Coinbase, Fannie Mae, and Better debuted Bitcoin-backed conforming mortgages, while Square auto-enabled Bitcoin payments for all US merchants. Meanwhile, Gemini faces a class action, GameStop wrote covered calls against its entire Bitcoin stack, and Tether signed KPMG for its first full audit.
Morgan Stanley Enters the Bitcoin ETF Race with Real Intent
MSBT at 14 basis points is not primarily a fee story. It is the first move of a bank absorbing Bitcoin into its full financial infrastructure.
Morgan Stanley priced MSBT at 14 basis points on NYSE Arca, undercutting BlackRock's iBit at 25 bps and making it the cheapest spot Bitcoin ETF on the market.
Morgan Stanley is the first bank issuer of a spot Bitcoin ETF, managing nearly $9.3 trillion in assets.
The firm has already formalized a 0-4% Bitcoin allocation recommendation and is waiving fees on the first $5 billion in AUM.
Bitcoin Is Becoming Collateral in the US Financial System
Two announcements this week show Bitcoin moving past investment product status and into the plumbing.
Coinbase, Fannie Mae, and Better launched the first Bitcoin-backed conforming mortgages, letting borrowers pledge BTC or USDC in Coinbase Prime as collateral for a home down payment.
The structure bundles a standard Fannie Mae mortgage and a digital asset-backed down payment loan into a single monthly payment.
Square auto-enabled Bitcoin payments for all eligible US merchants effective today, removing the prior manual opt-in and waiving processing fees through 2026.
Transactions settle via Lightning and default to USD at point of sale, meaning merchants take no custody risk and no price exposure.
The Agentic Economy Needs a Native Value Layer
There is a measurable performance gap between AI-forward companies and their competition showing up in revenue, and the infrastructure for how AI agents actually move money remains largely unbuilt.
The top 25 enterprise AI spenders have grown revenue over 100% since 2022; the bottom 25% have grown less than 20%, tracking the broader US economy.
Stablecoins are the V1 for AI value transfer, enabling agent-to-agent payments in dollars without legacy banking overhead.
Early Riders is backing founders building at this intersection through its Stables accelerator, focused on seed-stage infrastructure for the agentic economy and consumer-first Bitcoin applications.
Stablecoins Are Clearing the Regulatory Runway
The legislative picture is moving faster than most realize, and Tether's KPMG engagement signals that even the most skepticism-prone player is preparing the stablecoin market.
Clarity Act passage is expected by Q2 2026, with the political window tightening ahead of midterms.
The stablecoin yield debate is resolving around qualifying actions as the mechanism for passing through rewards, giving institutions a competitive offering without triggering deposit-equivalent treatment.
Circle stock dropped approximately 19% on the news that Tether had engaged KPMG for its first financial audit, reflecting concern that a credentialed Tether removes one of USDC's primary competitive advantages.
The structural implication: stablecoins let any payments app function like a bank. Once users grasp what inflation does to dollar balances, Bitcoin is the logical next step.
Quote of the week
"You're going to monetize it way beyond just those 14 bps because you're bringing it into your platform. You're bringing it into your ecosystem." — Liam Nelson, Early Riders
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