Grayscale Advances Plans to Convert Avalanche Trust Into Spot ETF

Grayscale has taken the next regulatory step toward converting its Avalanche (AVAX) Trust into a spot exchange-traded fund (ETF), filing an S-1 registration statement with the U.S. Securities and Exchange Commission (SEC) on Friday.

If approved, the ETF would be listed on Nasdaq, enabling traditional investors to gain exposure to AVAX through a regulated and accessible vehicle. The proposed structure would allow for cash-based creations and redemptions, facilitated by authorized participants. Coinbase is set to serve as the prime broker—handling custody and trade execution for AVAX—while BNY Mellon would act as the ETF’s administrator and transfer agent.

This S-1 filing follows Grayscale’s initial 19b-4 submission in March and marks the second formal step in the conversion process. Grayscale first launched its Avalanche Trust in August 2024 as part of a broader push into altcoin-focused products. The trust currently holds just under $15 million in assets under management (AUM), with a net asset value (NAV) per share of 12.20%, down from a December peak of 27%, reflecting AVAX’s price pullback and wider market volatility.

Avalanche is a proof-of-stake Layer 1 blockchain known for its customizable subnets, which allow developers to launch application-specific networks while remaining interoperable within the broader Avalanche ecosystem. Institutional adoption has been on the rise, with Visa integrating Avalanche into its stablecoin settlement infrastructure and launching the Avalanche Visa Card, enabling users to spend AVAX and stablecoins like USDC directly.

Despite growing use cases, AVAX has faced persistent market pressure. The token is currently trading at $24.25—down 9% year-over-year and 55% below its all-time high of $54.11 set in December.

Grayscale’s AVAX ETF is part of a broader trend among asset managers looking to expand beyond Bitcoin and Ethereum. Competitors including VanEck have also submitted filings for AVAX-based ETFs, signaling a growing appetite for diversified exposure to Layer 1 protocols.

If approved, Grayscale’s fund would be among the first U.S.-listed spot ETFs tied to a smart contract blockchain outside the crypto majors—potentially marking a significant evolution in how institutional capital approaches digital asset allocation.