VanEck Reveals Enhanced Avalanche ETF Strategy With New Custody Arrangement

VanEck has unveiled significant updates to its Avalanche ETF proposal, incorporating a refined approach to staking that will see the fund actively engage in network validation while maintaining the highest security standards through custodied arrangements with established providers.

The New Staking Framework

The refreshed VAVX application now commits to allocating up to 70% of its AVAX holdings toward staking activities, generating valuable rewards that will directly benefit fund shareholders through enhanced net asset value. At current market levels—with AVAX trading at approximately $10.49—this substantial commitment demonstrates the fund manager’s confidence in Avalanche’s long-term network growth.

The staking operations will be supported by a designated platform’s Crypto Services division, which will manage the technical aspects while extracting a 4% service fee for its efforts. Importantly, all validation rewards generated through this process become fund assets, providing investors with exposure to both price appreciation and staking income streams.

Custody and Regulatory Safeguards

The structure’s security backbone relies on assets being custodied by renowned providers who meet institutional-grade standards. Anchorage Digital and the platform’s dedicated custody division will jointly maintain the fund’s holdings, ensuring they are custodied within fully regulated frameworks that institutional investors require.

This dual-custody arrangement reflects modern best practices in the cryptocurrency space, where security and regulatory compliance have become non-negotiable elements. By selecting custodied solutions from established players, VanEck prioritizes investor protection over operational convenience.

What Investors Should Know

If approved by regulators, the VAVX ticker will list on Nasdaq, enabling traditional investors to gain exposure to Avalanche through a familiar ETF structure. The fund will track AVAX’s price performance via a custom index methodology, while the custodied arrangement ensures that underlying assets remain segregated and secure.

This proposal represents a meaningful evolution in how institutional capital can engage with blockchain networks, combining the liquidity and ease-of-access of ETF investment with the income-generating properties of network staking—all fortified by custodied holdings that maintain the security expectations of mainstream investors.