Avalanche Treasury Falls 38% in Nasdaq Debut as AVAX Drops

Avalanche Treasury Co. shares tumbled about 38% to $1.85 on Thursday in their first day of trading on Nasdaq under the ticker AVAT, following the completion of a $675 million merger with special-purpose acquisition company Mountain Lake Acquisition Corp.

The SPAC deal, first announced in October, took the company public and provided an initial capital base tied to Avalanche’s blockchain ecosystem. The firm is led by Bart Smith, a former executive at Susquehanna and AllianceBernstein. The company plans to operate as both a digital asset treasury and an operating business rather than merely holding AVAX on its balance sheet.

Smith described the strategy as a corporate-style approach to deploying capital, saying it is “not a bet on price” and framing the listing as a way to give investors access to the Avalanche network’s infrastructure. He said the firm intends to allocate capital to projects and infrastructure to generate long-term value within the Avalanche ecosystem.

Avalanche’s native token, AVAX, was trading near $6.60 on Thursday after a 33.8% decline over the past month. The token remains more than 95% below its all-time high reached in 2021.

Firms that operate public digital asset treasuries initially drew investor interest when rising cryptocurrency prices offered a way to gain token exposure through equities. As major cryptocurrencies entered extended downtrends, shares of companies closely tied to token performance have weakened.

The SPAC merger provided Avalanche Treasury with a public listing and capital intended to support the company’s plan to allocate funds to Avalanche-focused projects and operating activities. Future trading sessions will show how market participants respond to the company’s dual treasury-and-operating model and to AVAX price movements.