Grayscale Converts Avalanche Trust to ETF Spot
- A proposal has been submitted to the Securities and Exchange Commission, possibly adding another cryptocurrency ETF to public markets.
- Nasdaq has proposed to the Securities and Exchange Commission (SEC) to list the Grayscale Avalanche Trust (AVAX),potentially introducing another spot ETF for cryptocurrencies to public markets.
- According to documentation, the proposal seeks to convert Grayscale's existing Erax Trust, a closed-end fund launched in August 2024, into a spot ETF.
Nasdaq Proposes Grayscale Avalanche Trust (AVAX) ETF
A proposal has been submitted to the Securities and Exchange Commission, possibly adding another cryptocurrency ETF to public markets.
Nasdaq has proposed to the Securities and Exchange Commission (SEC) to list the Grayscale Avalanche Trust (AVAX),potentially introducing another spot ETF for cryptocurrencies to public markets.
According to documentation, the proposal seeks to convert Grayscale’s existing Erax Trust, a closed-end fund launched in August 2024, into a spot ETF. This transition would allow the product to leverage ETF pricing mechanisms,such as arbitrage,which helps align the market price more closely with the value of the underlying asset.
The Grayscale Avalanche Trust currently manages $1.76 million in assets. Each share represents approximately 0.49 AVAX.The fund is currently trading at a 7.4% premium compared to its net asset value.This spread represents one of the key inefficiencies that Grayscale aims to address through the conversion.
Grayscale has stated on its website that it considers its SEC-reporting funds as viable candidates for listing once regulations permit.
The company has been actively pursuing the conversion of multiple trusts into ETFs, following successful transitions for its Bitcoin and Ether products earlier this year.
This move adds Avalanche to the growing list of tokens Grayscale is seeking to include in the ETF space. documents also indicate potential spot ETFs for XRP, Cardano, and Litecoin, as well as the conversion of selected spin-off products to lower commissions, such as the Grayscale Bitcoin Mini Trust and Ether Mini Trust, designed to compete with rival offerings priced at just 0.15% per year.
Despite being an early entrant, Grayscale has been losing ground in the ETF market. Its flagship Bitcoin ETF, GBTC, has seen more than $21 billion in outflows since its conversion in January 2024, largely attributed to its management fee of 1.5%, which is the highest among its peers.
However, the company is moving forward with expanding its product range. The AVAX ETF proposal follows recent regulatory filings by both Nasdaq and NYSE that could shape the next wave of cryptocurrency fund products in the United States,including support for staking in Ether ETFs.
If approved, the AVAX ETF would represent another step toward broader institutional access to a wider range of cryptocurrencies and further test regulatory familiarity with altcoin-based products.