A $1 Billion Bet: Will AVAX’s Buyback-Style Surge Sustain?

Avalanche’s native token AVAX has surged to a seven-month high amid news that the Avalanche Foundation is in advanced discussions to raise up to $1 billion for U.S.-based digital asset treasury companies. According to reports, the initiative is being spearheaded through two separate fundraising structures: a Nasdaq-listed entity led by Hivemind Capital and a SPAC managed by Dragonfly Capital. Each aims to raise $500 million, with the proceeds earmarked to purchase AVAX tokens at a discount. This strategy is widely seen as analogous to a buyback program, with the potential to reduce circulating supply and drive upward price momentum.

The token’s price has responded positively, with AVAX climbing nearly 9% in the past 24 hours to $29, its strongest level since February. The surge outpaced the broader top-20 crypto assets, which averaged a 3% gain over the same period. AVAX has also ranked among the top 10 on CryptoSlate’s Biggest Gainers list for Sept. 11. On-chain activity has also seen a marked uptick, with decentralized exchanges on the network processing nearly $900 million in trading volume over the last 24 hours—the highest since March and among the top six globally.

Market analysts highlight strong technical indicators supporting the rally. The 24-hour trading volume for AVAX has surged by 100% to $1.93 billion, while the Relative Strength Index (RSI) has approached the overbought threshold of 70, signaling strong buying pressure. The Chaikin Money Flow (CMF) indicator has also risen to its highest level in nearly two months, further affirming inflows into the asset. Additionally, AVAX has broken out of a 213-day consolidation phase, triggering a technical breakout that analysts suggest could carry the price toward $32 and $36. If the upward momentum holds, some experts project AVAX could reach the mid-$40s or even $50+.

The Avalanche Foundation’s fundraising efforts align with a broader trend of digital asset treasury company (DATCO) formations across the crypto industry. Earlier this year, Ethereum-focused DATCOs have already accumulated over 4.9 million ETH, while Solana DATCOs have acquired 4.4 million SOL. These strategies have contributed to strengthening token valuations and institutional interest in digital assets. Avalanche’s real-world assets (RWA) segment has also seen significant growth, with tokenized assets on the platform exceeding $450 million, a 139% increase in the last month.

However, the bullish trajectory is not without risks. AVAX currently faces resistance at $30, and if investors begin booking profits at these levels, a pullback to $27 or even $25.86 could follow. Additionally, a failure to hold above the 20-day simple moving average of $24.99 could trigger a further decline. Analysts also note that the RSI nearing overbought territory suggests a possible correction if the market becomes overheated.