VanEck’s Avalanche (AVAX) ETF Filing Adds Staking Rewards, Names Coinbase as Provider
VanEck updated its proposed spot Avalanche ETF (ticker: VAVX) filing to add staking rewards alongside price exposure. The amended S-1 allows the fund to stake up to 70% of its AVAX holdings. Coinbase Crypto Services is named as the primary staking provider and will charge a 4% fee on staking rewards; those rewards will accrue to the fund and be reflected in the ETF’s NAV. Custody is planned with regulated custodians Anchorage Digital and Coinbase Custody using cold storage. The ETF will not use leverage or derivatives and will track the MarketVector Avalanche Benchmark Rate. The filing noted AVAX trading around $12.21 at the time. VanEck’s move follows similar yield-focused revisions by competitors (for example, Bitwise), indicating intensified competition among issuers to combine spot exposure with protocol-level yield. Regulators remain focused on disclosure and operational risk: staking introduces validator risk, slashing possibilities and added custody/governance complexity. If approved, VAVX could set a precedent for spot crypto ETFs that also capture staking income, potentially attracting investors seeking yield to offset crypto volatility.
Bullish
Adding staking to a spot AVAX ETF raises the asset’s utility and yield profile, which is likely bullish for AVAX price. For traders, the announcement increases demand prospects: an ETF that stakes up to 70% of holdings and funnels rewards into NAV creates a recurring source of demand from institutional ETF flows plus protocol-level yield capture. Short-term, price reaction may be muted or volatile due to regulatory uncertainty and operational risks (validator slashing, custody concerns) highlighted in filings; traders may see spikes on approval optimism and pullbacks on scrutiny or doubts. Long-term, if approved and adopted, VAVX could broaden institutional access and attract yield-seeking capital, supporting sustained demand and higher baseline valuation for AVAX relative to a non-staking ETF. Competition from other issuers offering similar yield features could amplify flows into AVAX but may compress relative advantage. Overall, the net effect on AVAX price is expected to be positive, contingent on regulatory approval and smooth operational execution.