TLDR
- Avalanche Foundation targeting $1 billion raise for two crypto treasury companies holding AVAX tokens
- Hivemind Capital leading $500M private placement in Nasdaq-listed company conversion
- Second $500M SPAC deal involves Dragonfly Capital with October timeline
- AVAX tokens sold at discount to foundation, representing 8% of circulating supply
- Anthony Scaramucci advising on first deal expected to close end of September
The Avalanche Foundation has launched efforts to raise $1 billion through two separate investment deals. The funds will create crypto treasury companies that purchase and hold AVAX tokens at discounted prices from the foundation.
This fundraising strategy aims to provide institutional investors with exposure to Avalanche’s native cryptocurrency through publicly traded vehicles. The approach follows the model established by companies like MicroStrategy, which holds Bitcoin on corporate balance sheets.
The foundation has structured this initiative through two distinct transactions. Each deal targets $500 million in funding and involves different investment structures and timelines.
Hivemind Capital Leads First $500 Million Deal
The first transaction involves a private placement led by Hivemind Capital, a New York-based blockchain investment firm. This deal focuses on converting an existing Nasdaq-listed company into an AVAX treasury vehicle.
Anthony Scaramucci, former White House communications director and prominent crypto investor, serves as advisor on this transaction. Industry sources indicate the deal could reach completion by the end of September.
The Nasdaq listing provides immediate public market access for traditional investors seeking cryptocurrency exposure. This structure eliminates the need for direct crypto purchases while offering AVAX price exposure through stock ownership.
Hivemind Capital will purchase AVAX tokens from the Avalanche Foundation below current market rates. This discount structure creates immediate value for the treasury company while generating capital for blockchain development.
Dragonfly Capital SPAC Structure Targets October Close
The second $500 million deal uses a Special Purpose Acquisition Company framework. Dragonfly Capital, a major crypto investment firm, plays a central role in this arrangement.
The SPAC structure provides another pathway to public trading while maintaining flexibility in deal execution. Sources familiar with the matter suggest this transaction may not complete until October.
Both deals combined would result in purchasing approximately 34.7 million AVAX tokens at current prices around $29. This represents roughly 8% of the 422.3 million tokens currently in circulation.
AVAX Market Response and Token Economics
AVAX has gained 16% over the past week following news of the fundraising plans. The token currently trades at $28.80, showing positive investor response to institutional interest.
Avalanche maintains a fixed supply cap of 720 million AVAX tokens. This scarcity model resembles Bitcoin’s limited issuance structure, potentially supporting long-term price appreciation.
The cryptocurrency reached all-time highs above $134 in November 2021. Since the 2022 market downturn, AVAX has traded in a lower range without exceeding $65.
The Avalanche blockchain launched in September 2020 as a smart contract platform supporting decentralized applications. Ava Labs, founded by Cornell University’s Emin Gün Sirer, develops the protocol.
Recent institutional developments include Grayscale Investments filing for a spot Avalanche ETF with the SEC in August. This filing represents additional potential institutional access to AVAX exposure beyond the treasury company model.
The foundation expects both deals to provide sustained institutional demand for AVAX tokens while offering traditional investors regulated access to cryptocurrency markets through established stock exchanges.
