Key learning points
- Avalanche crypto (AVAX) is making a splash in the headlines. But in the deluge of information, it can be hard to pinpoint exactly what’s happening, let’s explain.
- AVAX faces allegations of cheating against competitors from a Crypto Leaks report.
- Part of KKRs
Health Care Strategic Growth Fund II was recently tokenized on the Avalanche platform.
What is AVAX?
Let’s run through a little bit of backstory about AVAX first.
Avalanche is a cryptocurrency and blockchain platform created to compete with Ethereum. Within the Avalanche blockchain, AVAX is used as a token to support a range of blockchain projects, such as smart contract tracking.
After launching in 2020, the Avalanche platform has positioned itself to become a fast, affordable and secure way to process transactions. While the platform can continue to make AVAX coins up to the token limit of 720 million, the rate at which tokens are minted is affected by the votes of current AVAX holders.
AVAX is used to secure all transactions that take place on the Avalanche network, but you can buy the tokens on any major cryptocurrency marketplace.
AVAX: trends over time
Cryptocurrency investors are no strangers to market volatility. You could even argue that cryptocurrency is one of the more volatile asset classes out there. After hitting a record high of $146.22 in late 2021, AVAX’s value has plummeted. As of mid-September 2022, AVAX is trading at $19.49. That’s a loss of 87.6%.
AVAX: Latest News
The value of an AVAX token is tied to the utility of the Avalanche platform. If people want to use the Avalanche platform, AVAX tokens will increase in value. On the other hand, if the platform becomes outdated or just unpopular, the AVAX token probably wouldn’t be that useful for an investment portfolio.
Here’s a look at the latest headlines and how this information could affect AVAX’s value.
In August 2022, a self-proclaimed whistleblower called Crypto Leaks released a report detailing allegations against Ava Labs, the company behind the Avalanche blockchain. In this report, Crypto Leaks accused Ava Labs of shady backdoor deals designed to weaponize the power of lawsuits against other platforms.
Specifically, the report outlined a plan Ava Labs allegedly made with a law firm. The law firm, Roche Freedmen, is reportedly investigating Ava Lab rivals with the intent of collecting dirt. With the dirty laundry, the law firm would use the information to launch class action lawsuits against these rival firms.
The Crypto Leaks report states: “We can reveal that the pact instructs Roche Freedman and their leader Kyle Roche to: 1) use the US justice system – gangster style – to attack and harm crypto organizations and projects that may compete with Ava Labs or Avalanche in one way or another, 2) sue actors in the crypto industry in general with the aim of creating magnets for regulators like the SEC and CFTC that distract them from its highly commercial nature from Ava Labs and the Avalanche blockchain, and 3) secretly pursue Emin Gün Sirer’s personal vendettas against individuals.”
If rival companies faced lawsuits, it could significantly hamper their ability to compete with Ava Labs. According to the report, Ava Labs planned to reward the law firm with an extensive amount of AVAX tokens and Ava Labs stock.
After the report was published, AVAX’s value took a nosedive. Emin Gün Sirer, CEO of Ava Labs, denies allegations of improper agreements between his company and the law firm Roche Freedmen.
Private Equity Tokenization
As the allegations continue to swirl, there is an important piece of encouraging news about the Avalanche platform.
Securitize is a digital asset securities firm that has launched a fund that symbolizes a portfolio of KKR’s Health Care Strategic Growth Fund II. This tokenization happened on the Avalanche blockchain.
A major purpose of this tokenization is to create a path for individual investors to participate in private market investments. If the trend continues, this kind of tokenization could help investors dive into more investment opportunities in the private market first without any specialized connections or piles of cash.
If you want to invest in crypto, it is possible to buy AVAX tokens through major cryptocurrency exchanges. But when it comes to investing in individual cryptocurrency assets, it’s a good idea to prepare yourself for extensive monitoring.
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