Grayscale is pushing forward with its conversion strategy, filing for regulatory approval to turn its Aave trust into a spot exchange-traded fund. If approved, the product would provide investors with regulated exposure to the governance token of a top DeFi protocol.
In a Friday filing with the Securities and Exchange Commission, the crypto asset manager submitted a Form S-1 registration statement detailing its plan. The company intends to convert the existing trust and rename it the Grayscale Aave Trust ETF, with plans to list it on NYSE Arca under the ticker GAVE.
The proposed fund will have a fee of 2.5 percent. Grayscale has tapped Coinbase to fulfill the roles of custodian and prime broker for the ETF, ensuring the secure handling and operational support for the fund’s Aave holdings.
The filing comes amid a sustained push by asset managers to introduce ETFs tracking alternative cryptocurrencies. This activity indicates that Wall Street continues to see significant investor appetite for crypto exposure, even as the broader market experiences a downturn.
Aave is the dominant player in the decentralized finance sector. The protocol, which holds over $27 billion in total value locked according to DefiLlama, enables users to lend and borrow digital assets across several blockchains. The AAVE token serves as both a governance mechanism and a staking asset for earning yield.
