Key takeaways:
- Ava Labs, the leading developer of the Avalanche blockchain, is reportedly raising $350 million at $5.25 billion valuation
- According to Bloomberg which first reported the news, the information about the funding round came from “people familiar with the discussions”
- With a TVL of $10.3B, AVAX is the 4th largest DeFi blockchain, trailing only Ethereum, Terra, and BNB Chain
New capital would help Avalanche compete with Ethereum and other Layer 1 networks
Leading Avalanche developer Ava Labs is raising $350 million in a new financing round. As reported by Bloomberg, the round was not yet made public, but the person familiar with the matter said the company is raising the new funds at a $5.25 billion valuation.
In the two years since its launch in 2020, Avalanche has become one of the most popular layer 1 networks in the marketplace due to its high scalability and low transaction costs. According to data curated by DefiLlama, Avalanche is currently the fourth largest decentralized finance (DeFi) ecosystem, trailing only Ethereum, Terra, and BNB Chain. The total value of crypto funds invested in decentralized protocols running on Avalanche has grown from $259 million in April 2021 to over $10 billion just a year later.
Per DappRadar, Avalanche is currently home to more than 250 decentralized applications, with AAVE, Trader Joe, and Benqi accounting for the largest share of the total value locked (TVL) on the blockchain.
If it goes through successfully, the ongoing funding round will surpass the previous largest capital raise by Ava Labs by a considerable margin. The company raised $230 million last September in a private sale of AVAX tokens from a number of prominent crypto-focused investors, including Polychain and Three Arrows Capital.
The platform’s native governance token AVAX is currently trading at the $75 level, down roughly 48% from last November’s peak. With a circulating supply of more than 268 million tokens, AVAX’s market capitalization currently stands at $20.2 billion.
