Bitwise has updated its spot Avalanche ETF filing with the SEC, moving it closer to launch and potentially making it the first U.S. ETF to offer yield generation. The ETF, now named BAVA, features a low sponsor fee of 0.34%, undercutting competitors like VanEck and Grayscale, which charge 0.40% and 0.50%, respectively. BAVA plans to stake up to 70% of its AVAX holdings, allowing it to earn additional tokens from Avalanche’s proof-of-stake network. However, Bitwise intends to take a 12% share of the yield generated, with the remainder going to shareholders. In an effort to attract traditional investors, Bitwise is also offering a full fee waiver for the first month on the initial $500 million in assets. This strategy positions BAVA as a cost-effective option for those looking to gain exposure to Avalanche and earn staking income. The ETF's filing includes new liquidity reserves, stricter custody rules with Coinbase, and updated risk disclosures, addressing various threats including quantum-computing risks. If approved, BAVA would be traded on NYSE Arca, while competing ETFs from VanEck and Grayscale would list on NASDAQ. All three firms are anticipating approval in the first quarter of 2026. This move comes after the IRS issued guidance that clarifies the tax implications for yield-generating crypto ETFs, making it easier for such financial products to enter the market.