Avalanche Foundation Seeks $1 Billion for AVAX Treasury Vehicles

The Avalanche Foundation is pursuing deals to raise approximately $1 billion through two cryptocurrency treasury companies in the United States, targeting institutional investors seeking exposure to its AVAX token.

The foundation is in advanced discussions to launch one digital asset treasury company and convert an existing firm into such a vehicle, according to sources familiar with the discussions, the Financial Times reported today.

The first deal, led by Hivemind Capital and advised by Anthony Scaramucci, targets $500 million through a Nasdaq-listed firm. The second involves a $500 million SPAC backed by Dragonfly Capital, with completion expected by October.

Both vehicles would purchase AVAX tokens from the Avalanche Foundation at discounted prices, providing the foundation with capital while offering investors exposure to the blockchain's native cryptocurrency. The foundation holds significant reserves from the maximum supply of 720 million AVAX tokens, with approximately 420 million currently in circulation.

The deals would provide Avalanche Foundation with significant funding to support network development and adoption initiatives while creating new investment vehicles for institutions seeking blockchain exposure.

The fundraising effort comes as Avalanche positions itself as a preferred blockchain for traditional finance applications. Major investment firms including BlackRock, Apollo, and Wellington Asset Management have tested tokenized fund versions on the network, though AVAX has underperformed compared to competing blockchains like Ethereum and Solana.

The crypto treasury company model gained prominence following Strategy's Bitcoin accumulation approach, inspiring numerous firms to raise capital specifically for cryptocurrency purchases. Companies following this model have raised more than $16 billion this year, the FT noted, though recent share price declines among crypto treasury firms suggest potential market fatigue.

Avalanche Foundation operates as a non-profit organization supporting the blockchain ecosystem through education and community development. Like many blockchain foundations, it maintains reserves in low-tax jurisdictions while avoiding U.S. securities regulations through its non-profit structure.

The planned treasury vehicles represent Avalanche's bid to compete with other blockchain networks for institutional adoption and investment capital. While the network has gained traction among traditional finance firms for tokenization applications, AVAX's token performance has lagged behind competitors during the recent crypto market rally.