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Nasdaq has submitted a 19b-4 form to the U.S. Securities and Exchange Commission (SEC) to list and trade shares of Grayscale’s proposed spot Avalanche exchange-traded fund (ETF). If approved, the ETF will directly hold Avalanche’s native token, AVAX, providing investors with exposure to the Avalanche network through traditional brokerage accounts.

Grayscale’s Strategy to Expand Crypto ETFs

The move by Grayscale comes shortly after VanEck filed an S-1 registration statement to launch a competing Avalanche ETF. This development highlights the growing institutional interest in regulated altcoin investment vehicles. However, it is important to note that the SEC has yet to approve any spot crypto ETFs beyond Bitcoin and Ethereum, making this a pivotal moment for the crypto ETF market.

Details of the Proposed Avalanche ETF

The proposed Avalanche ETF seeks to convert Grayscale’s existing Avalanche Trust into a spot ETF. Initially launched in August 2024 as a private placement, the trust will transition into a publicly traded ETF if the SEC grants approval. According to the filing, Coinbase Custody will serve as the fund’s custodian, while BNY Mellon is expected to act as the administrator and transfer agent.

What Makes Avalanche Unique?

Avalanche is a Layer 1 blockchain known for its high throughput and scalability. Its native token, AVAX, plays a critical role in the ecosystem, being used for transactions, staking, and governance. Despite its technical strengths, AVAX has seen a recent price decline of over 7% in the past 24 hours, trading around $20.20 amid a broader market downturn.

Grayscale’s Broader Push into Altcoin ETFs

Grayscale’s filing for an Avalanche ETF follows its recent efforts to introduce a Cardano ETF, signaling a strategic push to expand the range of altcoins available in the regulated ETF market. This move reflects a broader trend among institutional players to offer more diversified crypto investment options to retail and institutional investors alike.

Implications for the Crypto Market

The SEC’s decision on these filings could set a significant precedent for the next generation of crypto ETFs. Approval of these altcoin ETFs would mark a milestone for the industry, potentially paving the way for more comprehensive crypto investment products beyond Bitcoin and Ethereum.

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