Grayscale Files to Convert Avalanche Trust Into Spot AVAX ETF

Grayscale Investments has filed an S-1 registration with the U.S. Securities and Exchange Commission (SEC) to get the Spot AVAX ETF registered. They are petitioning to transform its existing Avalanche Trust into a publicly traded spot AVAX exchange-traded fund (ETF) on Nasdaq.

The move would provide institutional and retail investors with regulated exposure to AVAX, the native token of the Avalanche blockchain, through a traditional investment vehicle. According to the filing dated August 22, the ETF will operate as a passive product that mirrors the price of AVAX and potentially incorporates staking rewards under specific conditions.

Grayscale Aims for Spot AVAX ETF

Under the suggested structure, authorized investors would make and redeem shares in cash instead of in-kind crypto transfers. This would make compliance easier. Coinbase will be the main broker, making it easier to trade AVAX and keep it safe. Banking giant BNY Mellon is in charge of administration and transfers. This shows that traditional banks are becoming more involved in the crypto markets.

Greyscale said that the trust will not use leverage, derivatives, or complicated techniques. Instead, it is only meant to keep track of how much AVAX is worth. Should staking be implemented, the firm intends to keep up to 85% of the trust’s tokens staked at any given time, generating potential yield while maintaining liquidity requirements. Importantly, any staked AVAX or associated rewards would be restricted from being transferred to other addresses during lock-up periods, in line with Avalanche network rules.

The filing signals Grayscale’s continued ambition to diversify beyond its flagship products. The firm currently operates two of the largest spot bitcoin ETFs with roughly $25 billion in assets under management, as well as a $5 billion ether fund, according to data from The Block.

Earlier this month, Grayscale also advanced efforts to launch a Dogecoin spot ETF, with NYSE Arca submitting a rule change to list the fund. Nasdaq previously filed 19b-4 documents with the SEC in March to allow trading of Grayscale’s proposed Avalanche ETF. Beyond AVAX and DOGE, the company is pushing for products tied to Solana (SOL), Cardano (ADA), and Litecoin (LTC), alongside a proposed multi-asset crypto fund.

The race to expand the roster of crypto ETFs is intensifying. With President Donald Trump’s pro-crypto administration ushering in friendlier regulatory conditions, multiple asset managers are positioning themselves to capture new market share. Firms including Bitwise, Canary, CoinShares, Franklin, 21Shares, and WisdomTree recently updated filings for spot XRP ETFs, underscoring heightened competition.

Bloomberg Intelligence ETF analyst James Seyffart described the flurry of filings as anticipated but nonetheless “a good sign” for the maturing sector.

For Grayscale itself, 2025 has been a year of corporate momentum. Founder Barry Silbert returned as chairman earlier this year, while the firm quietly prepared for a potential initial public offering through confidential SEC filings.

Despite the announcement, Avalanche’s token price faced downward pressure. AVAX fell more than 4% on Monday, trading at $24 per coin with a market capitalization of about $10 billion, according to The Block’s data dashboard.

If approved, the Avalanche ETF could mark another milestone in the mainstream adoption of crypto investment vehicles, offering investors easier access to one of the industry’s most prominent Layer 1 blockchains.

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