A firm has filed an S-1 registration statement with the US Securities and Exchange Commission (SEC) for a proposed exchange-traded fund (ETF) focused on Avalanche, aiming to give investors direct access to AVAX.
The registration indicates that the Avalanche ETF will hold AVAX directly and determine its share value using the MarketVector Avalanche Benchmark Rate, which compiles pricing information from the top five trading platforms as identified in CCData’s exchange benchmark report.
This submission comes on the heels of the recent registration of the Avalanche ETF in Delaware, reflecting the company’s ambition to broaden its portfolio of cryptocurrency investment options.
The firm has not yet revealed the ticker symbol for the ETF.
Growing interest in Altcoin ETFs
This initiative arrives as asset managers increasingly seek ETFs related to cryptocurrencies beyond just Bitcoin (BTC) and Ethereum (ETH).
Following the SEC’s approval of spot Bitcoin ETFs in January and its recent endorsement of Ethereum-based products, companies have begun investigating the viability of ETFs supported by alternative digital assets.
ETF analysts have evaluated the chances of approval for various altcoin-based ETFs, estimating a 90% likelihood for Litecoin, while predicting lower probabilities for XRP and Solana.
Avalanche’s performance, including its application in financial innovations such as a tokenized fund by Franklin Templeton, could bolster its case for regulatory approval.
Current regulatory landscape
The SEC has traditionally been cautious regarding crypto ETFs, expressing concerns about market manipulation and the need for investor protection.
However, evolving regulatory perspectives during the Trump administration and the creation of a Crypto Task Force have led to expectations for a more accommodating approach to digital asset offerings.
While the SEC’s response to the Avalanche ETF application remains to be seen, analysts consider this filing as a significant test case for the broader acceptance of altcoin ETFs.
If greenlit, it could pave the way for additional blockchain-focused investment products and further the integration of cryptocurrencies into conventional financial systems.