Quick Highlights
- Grayscale plans to convert its Avalanche Trust into a spot ETF.
- Up to 85% of the fund's assets could be used for staking.
- VanEck is also eyeing an AVAX-based ETF, signaling rising competition.
Grayscale Moves to Launch Avalanche Spot ETF with Plans for More Altcoin Funds
Grayscale Investments has filed with the U.S. Securities and Exchange Commission (SEC) to convert its Avalanche Trust into a spot ETF, continuing its efforts to expand into altcoin-based exchange-traded funds (ETFs).
This move comes after the company successfully launched similar products based on Bitcoin and Ethereum.
Grayscale first launched the Avalanche Trust in late August 2024 as a closed-end fund that exclusively invested in Avalanche (AVAX). Since then, it has expanded its focus to include a broader range of altcoins.
Future Plans: Expanding the ETF Portfolio
Grayscale has big plans to keep growing its ETF portfolio. The company aims to launch additional funds based on other altcoins in the near future.
According to the latest S-1 filing with the SEC on August 22, 2025, the Avalanche Trust will issue and redeem shares in cash. Coinbase will act as the custodian, while BNY Mellon will manage the trust and serve as the transfer agent.
In addition to its primary investment focus, Grayscale is also looking to increase the income potential of its trust. The filing mentions the possibility of generating additional returns through staking, and if approved, the fund plans to use up to 85% of its managed assets for this purpose. This new feature promises to give the trust a unique advantage in the altcoin space.
Rising Competition in the AVAX ETF Market
Grayscale isn’t alone in its interest in launching an AVAX-based fund. VanEck, another prominent financial firm, has also filed an application to offer a similar product.
Their filing also highlights the potential for staking, further showcasing the growing appeal of AVAX ETFs in the market.
