Bitwise Advances Avalanche ETF Filing with Lower Fees and Staking Features

Bitwise has taken another major step toward launching the first U.S. spot Avalanche (AVAX) exchange-traded fund capable of generating staking rewards, updating its S-1 filing with the Securities and Exchange Commission. The revised proposal introduces several key changes designed to position the fund—now expected to trade under the ticker BAVA—as one of the most cost-effective and feature-rich AVAX investment products available to traditional investors.

The most notable update is the adjustment of the ETF’s sponsor fee to 0.34%, making it cheaper than competing Avalanche ETF proposals from VanEck at 0.40% and Grayscale at 0.50%. Bitwise also plans to offer a temporary full fee waiver for the first month on the initial $500 million in assets, further strengthening its appeal for investors seeking low-cost AVAX exposure.

A defining feature of the updated filing is its allowance for the trust to stake up to 70% of its AVAX holdings on Avalanche’s proof-of-stake network. This would enable the ETF to generate additional AVAX tokens as rewards. While Bitwise intends to take a 12% share of the staking yield to cover expenses, the remaining rewards would be distributed to shareholders—an advantage competitors currently cannot offer, as their filings do not yet include staking capabilities.

This marks one of the first U.S. ETF proposals to fully adopt staking following recent IRS guidance that clarified the tax treatment of yield-generating crypto assets within ETFs. Bitwise also introduced new measures to bolster investor protection, including a liquidity reserve, stricter custody arrangements with Coinbase, and updated risk disclosures addressing potential threats such as quantum-computing attacks and exchange vulnerabilities.

If approved, BAVA will list on NYSE Arca, while VanEck and Grayscale plan to debut their Avalanche ETFs on NASDAQ. All three issuers are targeting potential regulatory approval in Q1 2026, setting the stage for a competitive new segment in the crypto ETF landscape.