Crypto asset manager Bitwise is looking to launch an exchange-traded fund tracking AVAX, the native token for the Avalanche Layer 1 blockchain. The product, if approved by the U.S. Securities and Exchange Commission, would tap Coinbase as a custodian.
"The Trust provides investors with the opportunity to access the market for Avalanche through a traditional brokerage account without the potential barriers to entry or risks involved with acquiring and holding Avalanche directly," Bitwise wrote in its S-1 filing on Monday.
Bitwise "believes that the design of the Trust will enable certain investors to more effectively and efficiently implement strategic and tactical asset allocation strategies that use Avalanche by investing in the Shares rather than purchasing, holding and trading Avalanche directly," the company added.
According to the SEC filing, the fund would establish its net asset value, or NAV, using the CME CF Avalanche–Dollar Reference Rate. It will hold AVAX tokens and not use derivatives, the filing noted. The NAV of an ETF is the total value of its underlying assets minus liabilities, divided by the number of outstanding shares, representing the per-share value of the fund.
Founded in 2017, Bitwise already offers a number of crypto investment solutions, including crypto index funds, ETFs that track Bitcoin and Ethereum, and other asset management services.
Earlier this month, Bitwise registered an Avalanche trust in Delaware, a preliminary step toward launching the product. Notably, rival crypto asset manager Grayscale has filed to convert its Avalanche Trust into a spot AVAX ETF, while VanEck is also seeking to list an AVAX fund.
Last week, the Avalanche Foundation said it is aiming to raise $1 billion to establish two AVAX treasury companies in the U.S. that would purchase tokens from the foundation at a discounted price. Digital asset treasuries, like ETFs, are another alternative way for investors to access crypto markets through traditional brokerage accounts.
Bitwise has filed to list several single-asset ETFs, including funds that would track Chainlink and XRP.
Avalanche, launched by Ava Labs in 2020, is a high-throughput, scalable blockchain built for decentralized apps. The network has become a popular choice for tokenized products, with Apollo and BlackRock tapping Avalanche to trial their onchain funds. Anthony Scaramucci's hedge fund SkyBridge has also considered Avalanche for tokenizing $300 million worth of assets.
AVAX is trading at $29.85, up slightly over 1% on the day, according to The Block's price page.
