The Avalanche Foundation announced a raise of $250 million via a locked sale of the AVAX token, the native token of the Avalanche blockchain, ahead of its planned launch of its significant Avalanche9,000 network upgrade.

The investment follows the testnet launch of Avalanche9,000, an upgrade designed to make it cheaper and easier to build on Avalanche and deploy dedicated, app-specific networks called “L1s,” formerly known as Avalanche subnets.

More than 40 venture capital firms participated in the sale, which was led by Galaxy Digital, Dragonfly, and ParaFi Capital. 

“Avalanche's upcoming Avalanche9,000 upgrade represents a pivotal step toward advancing the decentralized finance ecosystem,” said Dragonfly Managing Partner Haseeb Qureshi, in a statement. “We believe Avalanche is uniquely positioned to capture the growing momentum in Web3 and blockchain scalability.”

Avalanche is a layer-1 blockchain network that first gained prominence as a competitor to Ethereum, promising cheaper and faster transactions to fuel decentralized applications, or dapps. Over time, it has established itself as a prominent network for such dapps, alongside Solana.

Scheduled for release in early 2025, Avalanche9,000 is set to reduce deployment costs of Avalanche L1s by 99.9%. As of late November, more than 500 Avalanche L1s were in development, with popular examples of the app-specific blockchains run by developers of games like Off the Grid and Shrapnel.

As part of the rollout, the Avalanche Foundation is incentivizing builders with $40 million in retroactive grants, including up to $2 million in referrals via its Retro9,000 program. 

Avalanche’s native token, AVAX, has risen by more than 10% in the last 24 hours and is trading at $52.30. Its $21 billion market cap ranks it as the 12th largest crypto asset by market cap, according to CoinGecko.

Edited by Andrew Hayward