Grayscale Seeks SEC Approval to Convert Avalanche Trust Into Spot ETF on Nasdaq

Grayscale Investments has filed paperwork with the U.S. Securities and Exchange Commission (SEC) to transform its existing Avalanche Trust into a publicly traded spot exchange-traded fund (ETF).

If approved, the product would give investors regulated exposure to Avalanche’s AVAX token, according to an S-1 filing dated August 22.

What the Filing Proposes

The proposed ETF would track the price of AVAX, Avalanche’s native asset, with creations and redemptions carried out in cash through authorized participants. Coinbase is expected to handle prime brokerage services, including spot AVAX execution and custody, while BNY Mellon will serve as administrator and transfer agent.

Unlike leveraged or derivative-based vehicles, the fund would operate as a passive investment product, designed to closely mirror the token’s market value. Importantly, Grayscale noted that staking could be integrated if conditions allow. Under that model, up to 85% of the trust’s AVAX may remain staked, enabling the vehicle to capture additional staking rewards while maintaining exposure to the underlying asset.

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Why It Matters

Avalanche, a proof-of-stake Layer 1 blockchain known for its high-speed finality and subnet architecture, has grown into one of the leading networks in decentralized finance (DeFi) and tokenized applications. A spot ETF tied to AVAX would not only broaden regulated investor access but could also reinforce Avalanche’s positioning in the evolving landscape of digital assets.

If approved, the Grayscale Avalanche ETF would join the firm’s growing lineup of trust-to-ETF conversions, furthering its strategy to bring mainstream market infrastructure to crypto assets.