Grayscale files to convert AAVE trust into US ETF

Grayscale, a prominent digital asset management firm, has submitted a proposal to the US Securities and Exchange Commission (SEC) to convert its AAVE trust into an exchange-traded fund (ETF) in a filing dated February 13, 2026. 

The company adopted this decision to stay competitive in the crypto market, just after Bitwise, a major institutional crypto asset manager, outpaced it by submitting the initial proposal for an AAVE ETF approval. 

Notably, this move took place in December of last year. At this particular moment, reports highlighted that Bitwise had filed paperwork covering 11 separate funds.

Grayscale solidifies its position as a leader in the crypto industry 

AAVE is the native governance and utility token for the Aave protocol, a leading decentralized finance (DeFi) platform for lending and borrowing crypto assets. In terms of market capitalization, sources noted that the token has solidified its position in the crypto ecosystem, with a total market cap of about $1.8 billion. Currently, the token is trading at $119.02, up 4.87% over the past 24 hours, according to data from CoinMarketCap.

However, even with this rise, reports still acknowledged April 2021 as the period when the token hit an all-time high of $661.69.

Meanwhile, regarding Grayscale’s recent decision, analysts argued that the digital asset management firm seeks to mark a significant milestone with its AAVE token, which has recently drawn the attention of several investors and is increasingly popular as an investment option. 

Some of the investment products currently available in the crypto market include DeFi-focused index funds and standalone options such as the 21Shares AAVE ETP and the Global X AAVE ETP, both tradable in European markets.

It is worth noting that Grayscale has a history of converting closed-ended trusts into ETFs. This move caused the company to engage in a legal battle with the SEC.  After it secured a legal victory against the federal government agency regarding the conversion of its Bitcoin Trust, this accomplishment cleared the path for other US-based spot bitcoin ETFs.

On the other hand, sources noted that the proposed Grayscale AAVE ETF would charge a 2.5% sponsor fee based on net asset value. This percentage would be paid in AAVE. Moreover, the digital asset management company seeks to utilize Coinbase as both a prime broker and custodian. It also intends to secure a listing on the NYSE Arca market. 

Grayscale adopts several changes to its operation 

As competition in the crypto industry intensified, Grayscale announced last month its intention to convert its NEAR-linked closed-end trust into an exchange-traded fund (ETF). The firm made this announcement after filing a Form S-1 with the SEC.

The Grayscale NEAR Trust is an investment product providing institutional and accredited investors with secure, indirect exposure to the NEAR Protocol token. 

When reporters asked Grayscale about its next step regarding the effectiveness of the registration statement, the company shared that it intends to change the trust title to Grayscale NEAR Trust ETF and shift its listing from over-the-counter to NYSE Arca.

Afterwards, the digital asset management company published a statement on its website, disclosing that the trust held roughly $900,000 in assets at that time. The site also noted that, “this product has not met its investment objective and its shares, listed on OTC Markets, have sometimes traded at both higher and lower prices compared to their net asset value, with these differences being quite significant at times.”

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