Avalanche Foundation Seeks $1 Billion to Purchase AVAX Tokens
The Avalanche Foundation is in advanced talks to raise $1 billion in an ambitious plan to purchase millions of its native AVAX tokens, according to people familiar with the matter. The initiative reflects a growing effort by blockchain organizations to use traditional financial structures to support digital assets, while also testing the appetite of institutional investors for exposure to tokens.
The fundraising effort is being pursued through two separate U.S.-based crypto treasury vehicles, each targeting around $500 million. These vehicles are designed to pool institutional capital while offering AVAX tokens at discounted rates, a strategy that could both increase investor participation and reduce the circulating supply of tokens.
Two-pronged fundraising approach
The first transaction is being led by Hivemind Capital Partners, a digital asset investment firm. This deal intends to raise approximately $500 million using a Nasdaq-listed company as the investment vehicle. Anthony Scaramucci, the financier and former White House communications director, is involved as an advisor, adding a high-profile name to the deal’s structure. The second transaction is being structured through a special purpose acquisition company (SPAC) backed by venture firm Dragonfly Capital. That vehicle is expected to viewk a similar amount of capital, though it is likely to close at a later stage.
Avalanche operates a layer-1 blockchain that competes directly with ETH and Solana in the race to attract developers, decentralized applications, and users. Its network is designed for high throughput and low transaction costs, making it attractive for decentralized finance (DeFi), non-fungible tokens (NFTs), and other blockchain-based applications. The Foundation has a total supply of about 720 million AVAX tokens, with approximately 420 million currently in circulation. The tokens intended for sale would come from the Foundation’s reserves and be offered at discounted prices, providing institutional investors with preferential entry into the ecosystem.
Market implications and risks
Observers suggest that the planned transactions could influence AVAX’s price dynamics. By reducing the number of tokens available in circulation and channeling them into structured treasury vehicles, the Foundation could create upward pressure on the token’s value. However, much depends on the timing, scale, and execution of the deals, as well as how regulators view the use of SPACs and treasury structures for crypto fundraising.
The strategy also underscores the blending of traditional finance and digital assets. Treasury vehicles and SPACs provide familiar structures to institutional investors, but they also introduce additional layers of complexity and regulatory risk. Investor protections, transparency requirements, and disclosure standards remain key considerations as blockchain projects increasingly adopt Wall Street-inspired models to raise capital.
For Avalanche, the fundraising drive highlights both its ambition and its need to secure long-term financial support as it viewks to expand adoption of its blockchain. While the deals remain under negotiation and are not yet finalized, they illustrate how the next wave of digital asset growth may rely heavily on partnerships between crypto foundations and established financial structures.
If successful, the $1 billion initiative could mark one of the largest institutional fundraising efforts in the blockchain space this year, potentially setting a precedent for how other networks structure large-scale token acquisitions.
