Grayscale is moving ahead with its plans to turn its Avalanche (AVAX) Trust into a spot exchange-traded fund (ETF), filing an S-1 registration statement with the U.S. Securities and Exchange Commission on Friday.

If approved, the fund would trade on Nasdaq, giving traditional investors easier access to the AVAX token through a regulated vehicle.

The move marks the second regulatory step in the conversion process, following Grayscale’s initial 19b-4 filing in March. The fund would allow creations and redemptions in cash, managed by authorized participants. Coinbase would provide the prime brokerage services, including AVAX custody and trade execution, while BNY Mellon would act as administrator and transfer agent.

Grayscale launched its Avalanche Trust in August 2024 as part of a broader expansion into altcoin-focused investment products. The fund currently manages just under $15 million in assets, with a net asset value per share of 12.20%. That’s down from a high of 27% in December, reflecting both the broader crypto market downturn and AVAX’s price slide.

Avalanche is a proof-of-stake Layer 1 blockchain designed for custom, scalable networks called “subnets.” These let developers create application-specific chains while maintaining compatibility with the broader Avalanche ecosystem. In recent months, institutional interest in Avalanche has grown. Visa integrated the network into its stablecoin settlement system, and the launch of the Avalanche Visa Card allows users to spend AVAX and stablecoins like USDC directly.

Still, AVAX hasn’t escaped market headwinds. The token trades at $24.25, down 9% over the past year and 55% off its all-time high of $54.11 in December.

Grayscale isn’t alone in its push for an AVAX ETF. VanEck and several other asset managers have also filed similar applications, betting that investors are looking beyond Bitcoin and Ethereum for ETF exposure.

If the S-1 clears regulatory hurdles, the AVAX ETF would become one of the first U.S.-listed products tracking a smart contract blockchain outside the crypto majors. That could signal a shift in how traditional finance allocates to digital assets, with token-specific infrastructure plays becoming part of diversified crypto investment strategies.