Avalanche Treasury Co. (AVAT) is making a major move, planning to create a $1 billion AVAX reserve after a $675 million merger with a special purpose acquisition company (SPAC), Mountain Lake Acquisition Corp. The strategy involves starting with a $200 million purchase of AVAX tokens and aims for a Nasdaq listing in early 2026, a step that could significantly influence the token’s liquidity and institutional adoption.
Deal Structure and Treasury Strategy
Following the merger with the SPAC, a shell company designed to take businesses public, AVAT’s primary goal is to build a $1 billion treasury of AVAX. The first step is a $200 million acquisition of the tokens at a discount to the market price through an exclusive agreement with the Avalanche Foundation.
The company has reported $460 million in treasury assets and is targeting a Nasdaq debut in the first quarter of 2026, pending necessary regulatory and shareholder approvals. The capital is intended to fund projects built on Avalanche, support validator hardware, and develop enterprise partnerships, directly linking the growth of the treasury to the health of the ecosystem.
The initiative is backed by notable firms like Galaxy Digital, Pantera Capital, and VanEck. A key part of the strategy involves offering institutional investors an entry point at a 23% discount to the spot price of AVAX, a tactic designed to attract large-scale participation and support the ambitious $1 billion reserve target.
Implications and Risks
This plan carries several potential implications and risks for the Avalanche ecosystem. On one hand, institutional adoption could accelerate, as the involvement of well-known backers like Galaxy and VanEck brings credibility and may encourage more significant allocations to AVAX through this new structured vehicle.
The liquidity and price of AVAX could also be affected. A $1 billion buying pool represents substantial consistent demand, which could exert upward pressure on the price. However, it also risks concentrating a large portion of the supply within a single entity.
A key concern is governance risk. The exclusive agreement with the Avalanche Foundation and the aggregation of a vast number of tokens within AVAT’s treasury raise questions about the potential centralization of influence over network decisions.
Finally, regulatory and execution risks remain. The entire plan is contingent on a successful merger, shareholder approval, and a green light from regulators for the Nasdaq listing. The outcome of these processes will ultimately determine the timeline and final structure of the treasury.
The next major milestone is the successful closing of the merger, setting the stage for the pivotal Nasdaq listing in 2026. The market will be watching closely to see if AVAT can execute its plan and how this novel treasury model will impact the broader Avalanche network.
