Avalanche Foundation Targets $1 Billion Fundraise for Crypto Treasury Initiatives
The Avalanche Foundation, a nonprofit organization supporting the Avalanche blockchain, is reportedly pursuing a $1 billion fundraising effort aimed at launching digital asset treasury and accumulation projects. According to sources cited by the Financial Times, the Foundation is in active talks with investors to establish a digital asset treasury company and convert another entity into a “crypto-hoarding” vehicle.
Two Key Deals Underpin the Fundraising Effort
The $1 billion fundraising initiative appears to hinge on two major transactions. The first involves a $500 million private placement led by New York-based blockchain investment firm Hivemind Capital, targeting an existing Nasdaq-listed company. This deal is expected to close by the end of the month, with Anthony Scaramucci, a notable crypto investor and former White House communications director, acting as an adviser.
The second transaction is structured as a special purpose acquisition company (SPAC) deal involving prominent investor Dragonfly Capital. This round aims to raise up to $500 million but may not conclude until October, according to reported sources.
Token Purchase Strategy and Market Implications
Both Hivemind and Dragonfly are anticipated to acquire AVAX tokens directly from the Avalanche Foundation at a discounted rate. Given current market prices, the $1 billion investment translates to approximately 34.7 million AVAX tokens, roughly 8% of the 422.3 million tokens presently in circulation. Avalanche’s total token supply is capped at 720 million, similar to Bitcoin’s fixed supply model.
At the time of publication, AVAX traded at $28.8, marking a 16% increase over the past week. Since its peak price near $135 in November 2021, the token has experienced significant volatility but is now exhibiting renewed market momentum.
Background on Avalanche and Market Position
Launched in September 2020 by Ava Labs, Avalanche is an open-source blockchain platform designed to support decentralized applications and smart contracts. The project was founded by Cornell University professor Emin Gün Sirer. Avalanche ranks as the 21st largest cryptocurrency by market capitalization, valued at approximately $12.2 billion as of this writing.
Recent industry interest in Avalanche includes Grayscale Investments’ August filing with the U.S. Securities and Exchange Commission to launch a spot Avalanche exchange-traded fund (ETF), further underscoring the asset’s growing institutional appeal.
Efforts to raise substantial capital for strategic token accumulation indicate the Avalanche Foundation’s intent to strengthen the network’s treasury and potentially influence AVAX’s market dynamics.
FinOracleAI — Market View
The Avalanche Foundation’s $1 billion fundraising plan to acquire AVAX tokens at a discount signals a strong institutional commitment to the project, likely boosting investor confidence in the near term. The involvement of reputable firms like Hivemind Capital and Dragonfly Capital adds credibility and suggests significant capital inflows. However, the actual impact on AVAX’s price will depend on the timing and execution of these deals, as well as broader market conditions. Market participants should monitor deal closures and any shifts in token supply dynamics closely.
Impact: positive
