- VanEck’s Avalanche ETF may stake up to 70% of AVAX holdings, generating income via Coinbase with a 4% service fee.
- AVAX assets will be held by regulated custodians in cold storage, tracking prices through the MarketVector Avalanche Benchmark.
- Avalanche network saw record activity in December, with 680.6M active addresses and $616M deployed by institutional funds.
VanEck has amended its S-1 filing with the U.S. Securities and Exchange Commission to add staking rewards to its proposed Avalanche exchange-traded fund. The filing, submitted in December, covers the VanEck Avalanche ETF, expected to trade as VAVX on Nasdaq if approved. The update explains how staking income would be generated, managed, and reflected in the fund’s net asset value.
Staking Mechanics and Custody Controls
According to the amended filing, VanEck may stake up to 70% of the ETF’s AVAX holdings. Coinbase Crypto Services is listed as the initial staking provider. However, Coinbase will deduct a 4% service fee from any staking rewards earned.
The filing also details asset custody arrangements. Notably, AVAX will be held with regulated custodians, including Anchorage Digital and Coinbase Custody. Both custodians store assets offline in cold wallets. Additionally, VanEck confirmed the fund will not use leverage or derivatives. Instead, it will track AVAX prices through the MarketVector Avalanche Benchmark Rate.
Avalanche Network Activity
While ETF filings advanced, Avalanche network activity increased during December. According to Token Relations’ dashboard, Avalanche Layer-1 activity between December 15 and December 22 reached record levels. Apetrum processed 385,000 weekly transactions, while EVMOS recorded 94,800. NUMINE followed with 33,100 weekly transactions.
Notably, active addresses on Avalanche climbed to a record 680.6 million in December. Institutional alternative funds deployed on Avalanche also reached an all-time high of $616 million. Meanwhile, Season 3 of Avalanche Gaming’s Battle Pass became available for minting during the same period.
Avalanche ETF Structures
VanEck’s amendment arrives as other issuers advance competing Avalanche ETF proposals. Bitwise recently updated its S-1 filing to enable yield generation through staking. Grayscale Investments also submitted a second amended S-1 to convert its Avalanche Trust into a spot ETF.
Grayscale’s filing finalized in-kind creation and redemption mechanics and confirmed Grayscale Investments Sponsors LLC as sole sponsor. However, management fees and staking costs remain undisclosed. At press time, AVAX traded at $12.11, reflecting a 0.55% decline over 24 hours.
