- VanEck filed for an AVAX ETF to help investors gain exposure without holding the token directly.
- The SEC approval process may take months but new leadership could speed up the decision.
- AVAX saw a slight price increase but still faces challenges in market conditions and competition.
Crypto asset management firm VanEck has filed an S-1 registration with the U.S. Securities and Exchange Commission (SEC) for an Avalanche (AVAX) Exchange-Traded Fund (ETF). This follows the firm’s recent establishment of a statutory trust for the ETF in Delaware.
The ETF intends to provide investors with AVAX exposure without requiring them to hold the token directly. This approach reduces risks associated with storing digital assets on wallets or other platforms. Like traditional ETFs, AVAX ETF will list on a stock exchange with a ticker symbol yet to be announced. The custodian handling the ETF also remains undisclosed.
Price Tracking and Benchmarking
The ETF will track AVAX’s price while excluding operational costs. Its value will be based on the MarketVector Avalanche Benchmark Rate. VanEck will calculate this benchmark using price data from the top five AVAX trading platforms selected through CCData.
This marks VanEck’s fourth attempt at launching a crypto ETF. The firm previously filed for Bitcoin, Ethereum, and Solana ETFs. The SEC approved Bitcoin and Ethereum ETFs, while the Solana ETF remains under review.
Regulatory Review Process
The S-1 filing serves as the first step in the SEC’s approval process. The regulator may request modifications or additional details before making a decision. VanEck must also submit a second application, the 19b-4 filing, which allows the SEC to seek public input before final approval.
Approval Timeline and Market Impact
The approval procedure often extends beyond a six-month duration. The recent changes in SEC leadership position might expedite the review duration. The SEC crypto task force under Hester Peirce plans to speed up the approval process through establishing essential guidelines for digital assets.
AVAX Market Performance
Following the ETF news, AVAX recorded a modest increase after the news. However, the token remains in a downturn , declining 1.4% for the day, 27.7% for the month, and 62% for the year.
Market analysts believe the ETF could drive institutional interest and enhance AVAX’s credibility. However, they also highlight the need for Avalanche to address market conditions and competition to maximize its potential.
