Grayscale is taking a major step forward in its effort to launch an Avalanche ETF, filing an S-1 registration statement with the U.S. Securities and Exchange Commission (SEC) as it seeks to convert its Avalanche (AVAX) Trust into a spot ETF listed on Nasdaq.
What the Conversion to a Spot ETF Means
If the proposal is approved, Grayscale’s Avalanche ETF would offer a simplified route for traditional investors to gain exposure to AVAX within a regulated framework. Rather than holding AVAX directly, investors would be able to buy shares of the ETF through traditional brokerage accounts, providing easier and potentially more secure access to the Layer 1 asset.
This SEC filing marks the second regulatory milestone in Grayscale’s ETF journey, following a 19b-4 submission back in March 2025. The proposed product will operate with cash creations and redemptions. Coinbase will take the lead in prime brokerage services, managing trade execution and the secure custody of AVAX tokens. Meanwhile, BNY Mellon is designated to handle administrative tasks and act as the transfer agent for the fund.
AVAX Trust Performance and Current Standing
Originally launched in August 2024, the Grayscale Avalanche Trust is part of the firm’s broader strategy to offer exposure to altcoin ecosystems beyond Bitcoin and Ethereum. The trust currently oversees nearly $15 million in assets. Its net asset value per share stands at 12.20%, reflecting a decline from a peak of 27% in December. The drop highlights the combined effects of the broader crypto market slump and AVAX’s downward trajectory.
At the moment, AVAX is trading at $24.25. That’s a 9% dip over the past year and a staggering 55% off its record high of $54.11 reached last December. While under pressure, the project continues to attract attention from financial institutions and blockchain developers alike.
Why Avalanche Continues to Attract Institutional Interest
Avalanche stands out as a proof-of-stake Layer 1 blockchain that supports the creation of customized, scalable networks known as subnets. These application-specific chains can operate smoothly within the broader Avalanche ecosystem, giving developers the flexibility to tailor blockchain networks to specific use cases.
Institutional confidence in Avalanche is gaining momentum. Financial giant Visa recently integrated Avalanche into its stablecoin settlement framework. On top of that, the introduction of the Avalanche Visa Card allows direct spending of AVAX and stablecoins like USDC, signaling real-world utility for AVAX users.
The Avalanche Visa Card enables users to spend AVAX and stablecoins, enhancing the token’s real-world utility.
AVAX ETF Competition and Market Signal
Grayscale isn’t the only firm placing bets on AVAX’s institutional future. Asset manager VanEck and others have submitted similar proposals for an Avalanche ETF. With Bitcoin and Ethereum dominating the ETF space, these players are betting that investors increasingly want access to emerging smart contract platforms.
Should the SEC greenlight Grayscale’s S-1 application, the Avalanche ETF would become one of the first U.S.-traded funds tracking a smart contract blockchain outside the major crypto leaders. Such a development could encourage broader adoption of altcoin-based ETFs, making Avalanche a part of more diversified crypto investment portfolios. This shift could also mark a new phase in how traditional finance allocates resources in the digital asset landscape.
