Avalanche Treasury shares plunge 40% after Nasdaq debut

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Avalanche Treasury shares plunge

Sharp decline

AVAT shares fell more than 40% during their first trading session and closed at $1.85. After the market closed, the stock partially recovered, gaining about 2.7% in after-hours trading.

CEO Bart Smith said Avalanche Treasury plans to allocate capital across various areas of the Avalanche ecosystem, including validator infrastructure, partner projects, and protocol-level investments.

According to Smith, the firm's strategy is not based on speculation around the token's price but on the long-term development of the network and its institutional adoption.

AVAX reserve worth more than $1 billion

Plans to create Avalanche Treasury were first announced in October 2025, when the company revealed its merger with Mountain Lake Acquisition Corp. At the time, it said it intended to raise about $460 million to build a treasury reserve.

The agreement also included an initial allocation of $200 million worth of AVAX from the Avalanche Foundation at a discounted price. Over time, the company expects to acquire more than $1 billion worth of tokens.

The leadership team includes representatives from both traditional finance and the crypto industry. Advisors and board members include Ava Labs founder Emin Gun Sirer, Dragonfly partner Rob Hadick, Blockworks CEO Jason Yanowitz, and Aave founder Stani Kulechov.

The project has also received financial backing from Dragonfly, ParaFi Capital, VanEck, FalconX, Galaxy Digital, Pantera Capital, and Kraken.

What's next for Avalanche?

Despite AVAT's weak market debut, the Avalanche ecosystem continues to attract institutional capital. According to the company, more than $1.65 billion in tokenized real-world assets has been processed through the network.

Avalanche has also attracted more than $1 billion in institutional investment and supports over 550 projects. Amid growing interest in the tokenization of traditional assets, the network remains one of the most active blockchains in this segment.

Avalanche Treasury has joined a growing list of public companies adopting crypto treasury strategies. Similar structures have previously emerged around Bitcoin, Ethereum, Solana, and other digital assets.

The AVAX market already has another treasury company, AVAX One Technology Ltd., backed by SkyBridge Capital founder Anthony Scaramucci.

Earlier, Bitwise CEO Hunter Horsley said the market underestimates Avalanche's achievements in the tokenization of real-world assets (RWA). According to him, the network remains one of the leaders in the sector despite investor attention often focusing on larger blockchain projects.

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