TLDR
- Grayscale plans to convert its AAVE token trust into an ETF to list on NYSE Arca.
- The proposed AAVE ETF would have a 2.5% sponsor fee payable in AAVE tokens.
- Grayscale has previously converted other closed-ended trusts into ETFs.
- Coinbase will serve as custodian and prime broker for the Grayscale AAVE ETF.
Grayscale, a major crypto asset manager, has filed to convert its AAVE token trust into an exchange-traded fund (ETF). The move follows the success of its previous conversion of the Bitcoin Trust into an ETF. This filing, made with the U.S. Securities and Exchange Commission (SEC), marks the company’s latest effort to bring cryptocurrency investment products to traditional financial markets. Grayscale is seeking to list the AAVE ETF on the NYSE Arca, a major platform for ETF trading.
Bitwise’s AAVE ETF Filing Precedes Grayscale’s Move
Grayscale’s filing comes after Bitwise, another prominent player in crypto asset management, filed paperwork for its own AAVE ETF in December 2025. Bitwise’s filing covers 11 separate funds, with AAVE included in the broader suite. Although Bitwise may have reached the filing milestone first, Grayscale remains a strong competitor in the race to bring more crypto-related ETFs to market.
BREAKING: Grayscale Files S-1 For Spot Aave ETF. pic.twitter.com/ijr3FQVfkM
— SwanDesk (@SwanDesk) February 13, 2026
AAVE is the native token of the Aave protocol, a dominant decentralized lending platform in the decentralized finance (DeFi) space. With a market capitalization of around $1.8 billion, AAVE has gained attention as a prominent crypto asset. Its price recently saw a 9% increase, reaching $119. However, the token’s peak was much higher, at $661.69 in April 2021.
The Proposed AAVE ETF’s Structure and Key Details
Grayscale has outlined the structure of the proposed AAVE ETF in its SEC filing. The ETF would feature a 2.5% sponsor fee on the net asset value (NAV), which would be payable in AAVE tokens. Coinbase, one of the largest cryptocurrency exchanges, will serve as both the custodian and prime broker for the ETF.
These details are critical for investors, as the ETF would be designed to offer exposure to AAVE’s price movements while operating within the regulated framework of the NYSE Arca.
The decision to include Coinbase as the custodian is particularly noteworthy. Coinbase’s reputation as a reliable and secure cryptocurrency exchange provides added credibility to the Grayscale AAVE ETF, which could attract both institutional and retail investors seeking regulated crypto investment products.
AAVE’s Role in the Growing Crypto ETF Market
The push to launch the AAVE ETF is part of a broader trend of growing interest in cryptocurrency-based investment vehicles. Grayscale’s success in converting its Bitcoin Trust into an ETF was a key turning point, setting a precedent for other digital asset managers to follow. The launch of the AAVE ETF could further solidify crypto’s place in traditional financial markets, offering investors a regulated way to gain exposure to DeFi assets.
Other crypto-focused ETFs, such as the 21Shares Aave ETP and the Global X Aave ETP, already trade in Europe, giving investors access to AAVE through exchange-listed products. However, the conversion of the AAVE trust into an ETF listed on the NYSE Arca would mark a significant development for U.S. investors, expanding access to one of DeFi’s most influential tokens.
By seeking approval to list the AAVE ETF on a major U.S. exchange, Grayscale aims to continue its leadership in bridging the gap between the crypto market and traditional financial instruments.
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