Avalanche Bets $1 Billion on Crypto Treasuries Despite Cooling Market

The Avalanche Foundation, the non-profit entity overseeing the Avalanche blockchain, has announced plans to raise $1 billion through two separate initiatives aimed at establishing cryptocurrency treasury companies in the United States. These entities will acquire AVAX tokens, the native cryptocurrency of the Avalanche network, at a discounted rate, with the goal of enhancing liquidity and long-term institutional adoption. The initiative, reported by the Financial Times and corroborated by multiple sources, marks one of the largest treasury-focused projects in the crypto sector this yeartitle1^[1].

The first deal involves a $500 million private investment in an existing Nasdaq-listed company, led by blockchain-focused investment firm Hivemind Capital. Anthony Scaramucci, former White House press secretary and founder of SkyBridge Capital, is advising on the transaction, which is expected to finalize by the end of September 2025. The second deal, also targeting $500 million, will be structured as a special purpose acquisition company (SPAC) sponsored by cryptocurrency venture fund Dragonfly Capital. This latter transaction may conclude in Octobertitle2^[2].

Avalanche's strategy aligns with a broader industry trend of publicly listed companies pivoting to crypto treasury models, a trend exemplified by MicroStrategy's accumulation of Bitcoin. However, the recent cooling of the crypto bull market-marked by declining share prices for some crypto treasury companies-has tempered enthusiasm for the approach. Despite this, Avalanche's AVAX token has shown resilience, trading with a modest 2.1% decline in the last 24 hours while the broader market, as measured by the CoinDesk 20 Index, rose 0.65%title3^[3].

The Avalanche Foundation's move leverages its position as a key player in tokenization and institutional adoption. Major financial firms, including BlackRock, Apollo, and Wellington Asset Management, have piloted tokenized fund projects on the Avalanche blockchain, signaling growing institutional confidence in its infrastructure. The foundation's decision to sell AVAX at a discount to treasury firms aims to incentivize participation while stabilizing the token's market dynamicstitle4^[4].

Analysts note that the $1 billion fundraising effort could bolster Avalanche's competitive edge against rivals like Ethereum and Solana. While Ethereum and Solana have seen significant price surges this year, Avalanche's AVAX has lagged. By securing institutional backing and expanding its treasury footprint, the project seeks to close this gap and position itself as a preferred blockchain for tokenized assets. The initiative also reflects Avalanche's broader ambition to become a foundational platform for global capital marketstitle5^[5].

The success of these treasury companies will depend on several factors, including the execution of the fundraising deals and the broader macroeconomic climate. Institutional investors and family offices are increasingly allocating capital to crypto treasuries, but market volatility and regulatory uncertainties remain risks. The Avalanche Foundation's ability to maintain transparency and deliver on its tokenization roadmap will be critical in sustaining investor confidencetitle6^[6].