Grayscale has filed a second S-1 amendment to finalize the mechanism for converting Avalanche Trust into the AVAX crypto spot ETF, moving closer to its goal of listing on the Nasdaq under the ticker symbol GAVX.
The updated filing focuses on the fund's certificate creation/circulation mechanism and sponsor structure, while still omitting key fees. This move comes as several other institutions are also accelerating their filings for Avalanche ETFs in the US.
- Grayscale has updated its S-1 certification for the second time, finalizing the in-kind creation and redemption model for the Avalanche spot ETF, tentatively ticked as GAVX.
- The consolidated filing includes details on sponsor Vai and enhanced risk disclosure and financial data, but does not yet mention management fees and Staking costs.
- The Avalanche ETF race has been joined by Bitwise and VanEck, with VanEck having announced a 0.34% management fee and XEM Staking.
Grayscale is finalizing the S-1 approval for the Avalanche Spot ETF.
Grayscale filed a second S-1 amendment to refine how it converts Avalanche Trust into an Avalanche spot ETF, emphasizing an “in-kind” mechanism and preparing for a Nasdaq listing under the ticker symbol GAVX.
In its updated S-1 filing, Grayscale focuses on the “operating mechanism” rather than simply describing the product concept. The key point is the move toward an in-kind model for creating and redeeming fund units, meaning authorized participants Fungible Avalanche ( AVAX ) Token for ETF units and vice versa.
According to the description, this approach is generally expected to track prices more closely than a cash-only model, while also increasing tax efficiency in certain operating scenarios. This is also a topic that has previously attracted market attention in Bitcoin ETFs and other spot crypto ETFs in the US.
The "in-kind" model aims to improve price tracking and tax efficiency.
The "in-kind" model allows for direct swapping of AVAX with ETF certificates, thereby reducing trading friction and potentially helping ETF prices track the underlying asset more closely than a cash-only mechanism.
With in-kind trading, the market maker/authorized partner can deposit AVAX into the fund to receive certificates, or pay for certificates to receive AVAX. This mechanism typically reduces the need to buy/sell the underlying asset with cash at the time of creation/repurchase, thereby potentially reducing tracking spreads during periods of market volatility.
The filing also shows Grayscale is nearing the "technical finalization" stage for a product geared towards major exchanges, rather than maintaining an OTC structure like many previous trusts. If approved, AVAX approach would shift significantly towards the traditional brokerage account channel.
Grayscale consolidates sponsors to increase governance accountability.
Grayscale confirmed Grayscale Investments Sponsors LLC as the sole sponsor, aiming to simplify governance and respond to regulatory expectations from the SEC.
The consolidation of sponsor Vai is XEM as a procedural "clearing step," helping to clarify legal responsibilities and control mechanisms for the Trust/ETF after conversion. In practice, a clear sponsor structure often facilitates the XEM process by regulatory authorities when applications meet disclosure requirements, risk control, and investor obligations.
However, the current documentation still lacks information that directly impacts holding costs, such as management fees, Staking fees, and the possibility of fee waivers/reductions. Leaving the price section blank may reflect a strategy of waiting for the market and competitors to announce their prices first.
Grayscale is delaying the announcement of fees as it observes market competition.
Grayscale has not yet disclosed its management fees and Staking costs, likely to maintain flexibility ahead of its Nasdaq listing and while waiting for competitors to finalize their valuations.
The "wait and see" strategy is applied in the context of the product's planned transition from OTC trading under the ticker symbol "AVAXFUN" to Nasdaq listing under the ticker symbol "GAVX". This change of trading platform typically involves requirements for standardized documentation, increased risk disclosure, and periodic updates of financial data.
From a competitive perspective, fees are the most important variable affecting the ability to attract capital, especially when many crypto ETFs offer similar products. Therefore, not finalizing fees allows Grayscale the flexibility to adjust them and avoid being at a disadvantage if market fees decrease.
Meanwhile, the price of AVAX at the time of this article had fallen to $12.11, a decrease of 0.55% in 24 hours. This development is described as a general cooling trend in the crypto market rather than a factor specific to Avalanche.
Bitwise and VanEck have joined the fray, accelerating the Avalanche ETF race.
Besides Grayscale, Bitwise has filed an S-1, and VanEck has amended its filing for the third time, in which VanEck announced a 0.34% fee and consideration of Staking, making the Avalanche ETF race distinctly competitive.
Bitwise entered with its own S-1 filing and selected Coinbase as its custodian, expanding its Crypto ETF portfolio in an institutional and compliant direction. This is a familiar model in US crypto spot ETF products, where custody and operational risk control are central to the due diligence process.
VanEck is reportedly moving quickly with its third revision, simultaneously announcing a 0.34% management fee and XEM mechanisms related to Staking rewards. The early announcement of fees puts competitive pressure on remaining applications, especially for issuers looking to optimize costs to attract Capital.
If approved, the Avalanche spot ETF could integrate AVAX into traditional brokerage accounts, increasing liquidation and regulatory legitimacy, thereby supporting access for institutional investors.
Conclusion: The new structure may help GAVX maintain its price better, but the fees remain an unknown factor.
Grayscale's new S-1 filing improves the operational structure for GAVX, but the key to its competitiveness will still be the fees and how Staking is handled in the final release.
- The proposed structure could help GAVX track prices more closely and increase tax efficiency compared to a cash-only model.
- Grayscale is showing signs of observing competitors like VanEck by announcing its fees before finalizing its fee structure.
Frequently Asked Questions
Which Avalanche Spot ETF is Grayscale seeking approval for?
Grayscale is updating its S-1 filing to convert Avalanche Trust into the AVAX crypto spot ETF and preparing for a Nasdaq listing under the ticker symbol GAVX.
What does the "in-kind" model mean in the AVAX ETF?
"In-kind" allows authorized participating parties to directly swap AVAX for ETF certificates (and vice versa), instead of just creating/repurchasing with cash, thereby reducing friction and potentially tracking prices better.
Why hasn't Grayscale announced its management fees yet?
The current listing does not specify management fees, Staking fees, or fee waivers/reductions. This could give Grayscale flexibility in the face of competition, especially as rivals announce their fees early.
What other organizations are applying for an Avalanche ETF?
Bitwise has filed an S-1 and uses Coinbase as its custodian. VanEck has filed a third amendment, announced a 0.34% management fee, and is XEM Staking.
