The 11th-largest cryptocurrency, Avalanche (AVAX), rose on Thursday after digital asset management Valkyrie announced the formation of an investment trust dedicated to the token.
In just a few hours, AVAX soared 14 percent to a one-week high of $68.36. The increase occurred shortly after Valkyrie’s announcement, which is expected to attract further institutional investment to the Avalanche blockchain.
Institutional investors are becoming more interested in the coin, according to the asset management.
AVAX’s gains were aided by a broader rally in the cryptocurrency market, as investors were relieved that the US Federal Reserve lifted interest rates as expected. In the last 24 hours, the whole crypto market capitalisation increased by roughly $100 billion.
Valkyrie establishes the Avalanche Trust; will prices rise?
In a news statement issued on Wednesday, Valkyrie, a well-known digital asset management, announced the new trust. The trust will invest in AVAX on behalf of institutional investors, giving them access to the token without having to buy it themselves.
According to Valkyrie, the planned investment trust will only be available to qualified investors. Avalanche, according to the asset management, is the “fastest smart contracts platform” in the blockchain sector.
In order to accomplish this, the Valkyrie will begin staking AVAX through the trust. The decision reflects institutional investors’ increased interest in proof-of-stake (PoS) networks, which is likely sparked by Ethereum’s anticipated switch to the medium later this year.
Proof-of-stake networks are all the rage right now.
The proposed switch to a PoS network by Ethereum has sparked interest in alternative PoS currencies including AVAX, SOL, and ADA. Avalanche, in particular, is considered as a major Ethereum contender.
PoS tokens appear to be gaining traction among institutional investors as a viable alternative to Bitcoin. PoS is also more appealing to environmentally minded authorities due to its lower energy consumption when compared to proof-of-work tokens.
CoinShares, Grayscale, and 21Shares are among the digital fund managers who have launched PoS-exposed products this year, claiming increased demand from institutional investors.
Related Posts – AMC Theatres Explores Accepting Dogecoin, CEO Sees Awing DOGE Poll Results
