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Crypto asset manager Grayscale has taken another major step in its bid to bring Avalanche into the U.S. exchange-traded fund (ETF) market. On Friday, the firm submitted a registration statement with the U.S. Securities and Exchange Commission (SEC), seeking to convert its Avalanche Trust into a full-fledged ETF listed on Nasdaq.
The product, originally introduced last year as a private placement for accredited investors, offers exposure to Avalanche’s spot price. According to the SEC filing, the fund’s coins are held securely by Coinbase, one of the industry’s largest custodians. If approved, the move would represent another significant milestone in expanding investor access to altcoin-focused ETFs.
Grayscale and VanEck Compete for Avalanche ETF
Grayscale is not alone in pursuing Avalanche exposure through regulated financial products. Earlier this year, asset manager VanEck filed its own application for a spot Avalanche ETF, establishing a Delaware trust structure to support the fund. While the SEC delayed its decision on VanEck’s proposal in June, analysts believe both firms remain well positioned ahead of a potential wave of approvals this fall.
In March, Nasdaq submitted a 19b-4 form to list shares of Grayscale’s Avalanche Trust, setting the stage for Friday’s follow-up filing. Together, the applications highlight a growing race among U.S. asset managers to expand beyond Bitcoin and Ethereum ETFs, which made their market debut last year.
SEC Shifts Toward Merit-Neutral Review
The SEC’s stance on crypto ETFs has long been marked by delays and hesitancy, but recent developments suggest a more open approach. In July, the Commission granted Grayscale approval to list an ETF holding Solana, XRP, and Cardano, though its debut was temporarily postponed. Later that month, regulators clarified that they were pursuing a “merit-neutral” framework for crypto ETF applications, meaning approval would hinge less on individual project risks and more on structural compliance.
This shift has encouraged optimism among industry experts. Bloomberg ETF analyst James Seyffart recently estimated a 90% chance that Avalanche ETFs gain approval in the U.S. before year-end. He issued similar forecasts for ETF products linked to Dogecoin, Cardano, Polkadot, and HBAR.
Avalanche’s Market Position and Price Outlook
Avalanche currently ranks as the 22nd largest cryptocurrency, with a market capitalization of roughly $10 billion, according to CoinGecko data. As of Monday, AVAX traded at $24, down 7.6% over the past day, continuing a broader trend of volatility across altcoins.
Despite the short-term dip, analysts remain bullish on Avalanche’s long-term prospects. In April, Standard Chartered projected AVAX could reach $55 by the end of 2025 and as high as $250 by 2030, citing its distinctive approach to scalability through “app networks,” previously referred to as subnets. These specialized networks allow developers to customize blockchain environments, making Avalanche an attractive choice for decentralized finance (DeFi) and enterprise adoption.
Avalanche was one of the fastest-growing blockchain ecosystems during the 2021 bull market, reaching an all-time high near $155. Although its price has retraced significantly since then, the project continues to maintain strong DeFi activity. On Monday, Avalanche recorded nearly $2 billion in total value locked across decentralized applications, according to DefiLlama.
Industry Competition Heats Up
Grayscale’s ETF filing comes at a time of intense competition among asset managers seeking to bring regulated altcoin exposure to investors. Solana, XRP, and Cardano have all been at the center of similar filings, with industry participants betting on an eventual broadening of the crypto ETF market.
The introduction of Bitcoin and Ethereum spot ETFs last year was a turning point, unlocking billions in inflows from both institutional and retail investors. Should the SEC approve Avalanche ETFs this fall, it could provide the token with a similar boost, increasing liquidity and potentially drawing new capital into the ecosystem.
October Seen as Key Decision Month
With several crypto ETF applications under review, October is shaping up to be a pivotal month for the industry. Market observers expect the SEC to issue decisions on multiple altcoin products within weeks, potentially opening the door for Avalanche, Solana, Cardano, and others to trade on major U.S. exchanges.
For Grayscale, the ability to convert its existing trust into an ETF could prove advantageous, giving it a head start in offering regulated Avalanche exposure. VanEck, however, remains a strong contender with its own trust structure already in place.
As the deadline approaches, investors will be watching closely. Approval of Avalanche ETFs would not only mark a milestone for the project itself but also signal further regulatory acceptance of altcoins in traditional financial markets.
