Avalanche, the high-performance Layer-1 blockchain platform developed by Ava Labs, is in talks with investors to set up two US “digital asset treasury” companies. The blockchain firm is aiming to raise over $1 billion to buy millions of AVAX at a discount.
As per a latest report by Financial Times, Avalanche is planning to provide discounted access to millions of AVAX tokens to companies that hold or “hoard” large amounts of cryptocurrencies. With this, it wants to potentially boost the ecosystem’s liquidity and adoption amid the current growing institutional interest in blockchain technology.
Further, Avalanche’s approach will allow the participating companies to accumulate more AVAX without immediate market impact, while also funding Avalanche’s expansion. The funds will later be used to improve development in areas like real-world asset (RWA) tokenization, decentralized finance (DeFi), and custom subnet blockchains.
Avalanche has been positioning itself as a go-to platform for institutions, with recent partnerships like the one with Toyota for blockchain-based mobility networks indicating its focus towards entrepreneurship.
Background on Avalanche and Crypto-Hoarding
Launched in 2020, Avalanche was branded as a scalable alternative to Ethereum, featuring three core chains namely X-Chain for assets, C-Chain for smart contracts, and P-Chain. The network uses an unique Avalanche Consensus Mechanism for achieving sub-second finality with low fee transactions. It has since attracted over $2 billion in total value locked (TVL), ranking it among the top 10 blockchains.
Avalance’s AVAX token has surged with notable gains since the release of the news. It is currently trading at $28.80 and has risen by 6.8% in the last 24 hours, positioning it at 16th position among top crypto projects by market cap, as per CoinMarketCap data.
Consequently its volume has also increased by over 8% to $1.84 billion in the last 24 hours.