From Trust to ETF: Grayscale Moves to List Avalanche Fund on Nasdaq

Grayscale Investments has submitted a registration statement to the SEC seeking approval for a spot Avalanche (AVAX) exchange-traded fund, furthering the trend of altcoin exposure in traditional finance.

Grayscale’s Filing and Structure

The digital asset manager filed its S-1 registration with the U.S. Securities and Exchange Commission (SEC) on August 22, 2025, proposing to convert its existing Avalanche Trust into a publicly traded ETF on Nasdaq. If approved, the product will trade under the ticker symbol AVAX, giving retail and institutional investors direct access to Avalanche’s native token through standard brokerage accounts.

This filing marks the second stage of the approval process, following Nasdaq’s initial application in March 2025. Grayscale has indicated that upon effectiveness, the fund will be renamed the Grayscale AVAX Trust ETF.

Fund Details and Operations

The ETF will operate on a creation and redemption system built on “baskets” of 10,000 shares. Authorized participants can subscribe or redeem in cash, while a separate liquidity provider will conduct the actual AVAX token transactions.

Coinbase Custody has been appointed as custodian for token storage and security, while BNY Mellon will serve as administrator and transfer agent overseeing daily operations.

A unique aspect of the proposal allows up to 85% of the fund’s AVAX holdings to be staked, potentially generating additional rewards that would be reflected in the ETF’s net asset value, subject to regulatory approval.

Competition from VanEck

Grayscale is not alone in pursuing an Avalanche ETF. VanEck submitted a similar application earlier this year, with its filing acknowledged by the SEC in April 2025. The regulator, however, delayed its decision until mid-July, signaling its cautious stance on ETFs tied to cryptocurrencies outside of Bitcoin and Ethereum.

VanEck’s proposed fund would benchmark performance using the MarketVector Avalanche Benchmark Rate, aggregating pricing data from the five largest AVAX trading platforms.

Market Backdrop

The push for Avalanche ETFs comes at a time when the token has faced considerable price pressure. After reaching a high of $54.2 in December 2024, AVAX has since lost more than half its value, trading at $24.3 as of Monday, according to CoinGecko. The asset is down 35% year-to-date, a stark contrast to Bitcoin and Ethereum, which have both gained about 70% over the same period.

Despite price volatility, the introduction of an AVAX ETF could broaden investor access and test regulatory appetite for altcoin-based exchange-traded products in U.S. markets.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice