Grayscale Investments has taken another step towards broadening its range of cryptocurrency investment products, filing with the United States Securities and Exchange Commission (SEC) to launch a spot Avalanche (AVAX) exchange-traded fund (ETF). The move highlights the asset manager’s continued push to bring digital assets into mainstream financial markets.
Plan to Convert Avalanche Trust into ETF
According to a registration statement released on Monday, Grayscale filed the application with the SEC on Friday. The firm intends to convert its existing Avalanche Trust, launched in August 2024, into a publicly traded ETF. The proposed product would carry the ticker AVAX, identical to the native token of the Avalanche blockchain.
If approved, the ETF would provide investors with regulated, exchange-traded exposure to AVAX through standard brokerage accounts. This structure is intended to make access to the cryptocurrency market simpler, particularly for investors unwilling or unable to hold digital assets directly.
Custodian and Administrative Support
The filing also outlined operational arrangements for the fund. Coinbase Custody has been selected as the custodian responsible for safeguarding the AVAX tokens backing the ETF. BNY Mellon is expected to act as the fund’s administrator and transfer agent, ensuring proper oversight, accounting, and management of the product.
These partnerships mirror the arrangements used in Grayscale’s other crypto-related investment products and highlight the growing role of established financial service providers in supporting digital asset markets.
Nasdaq Backs Listing Effort
The ETF’s path to market is also linked to Nasdaq. In March 2025, the US stock exchange submitted its own filing to the SEC, requesting permission to list the Avalanche ETF. Grayscale confirmed that, once the registration statement is declared effective, the product will be renamed the Grayscale AVAX Trust ETF and traded on Nasdaq.
An excerpt from the title page of the S-1 for Grayscale Avalanche Trust (AVAX). Source: SEC
The collaboration between Grayscale and Nasdaq underlines the growing interest from traditional exchanges in supporting crypto-based financial instruments. Nasdaq has previously positioned itself as a potential home for multiple digital asset ETFs, seeking to bridge the gap between traditional markets and the cryptocurrency sector.
Expanding Suite of Spot Crypto ETFs
This latest move reflects Grayscale’s broader strategy of building a diverse set of spot crypto ETFs. Earlier this year, the company filed applications for ETFs tracking XRP and Dogecoin, both of which followed the same model of converting existing trusts into exchange-traded products.
The firm has long positioned itself as a pioneer in the digital asset investment space, starting with the Grayscale Bitcoin Trust (GBTC). That product later converted into a spot Bitcoin ETF after years of regulatory delays and court challenges. The success of GBTC’s transition provided a framework for other single-asset crypto ETFs.
Regulatory Context and Market Impact
The SEC has been cautious in approving cryptocurrency ETFs, particularly spot-based products. Until 2024, the regulator had only allowed futures-based ETFs, citing concerns over potential market manipulation in spot trading. However, the eventual approval of Bitcoin and Ethereum spot ETFs signalled a shift in policy, paving the way for products such as the proposed AVAX ETF.
If granted approval, the Grayscale Avalanche ETF could provide greater legitimacy for AVAX in global markets and potentially attract institutional investors seeking exposure beyond the largest digital assets. It may also boost trading volumes and liquidity for the cryptocurrency, which was priced at around $24.47 at the time of the filing.
Grayscale’s Strategic Position
By pursuing ETFs across a range of tokens, Grayscale is attempting to cement its position as the leading provider of regulated crypto investment vehicles. The company argues that ETFs offer a more efficient and investor-friendly option than trusts, particularly in terms of transparency, liquidity, and fees.
The introduction of a spot AVAX ETF also reflects the rising profile of the Avalanche network, which has built a reputation for fast transaction processing and scalable blockchain solutions. The product would allow investors to tap into the network’s growth without directly managing wallets or private keys.
Outlook
The outcome of Grayscale’s application will depend on the SEC’s willingness to continue expanding the range of approved crypto ETFs. With Nasdaq already on board as a listing partner and major custodians involved, the filing signals significant industry support.
Should the ETF secure approval, it would represent another milestone in the integration of digital assets into traditional financial infrastructure and reinforce Grayscale’s role at the forefront of this shift.
