Avalanche AVAX Dips 8% Today: $1B Treasury SPAC and ETF Hopes Spark Rebound Hype

October 13, 2025 – Avalanche (AVAX) is also facing acute volatility today as it fell 7.93% to $21.10 as the rest of the cryptocurrency market corrects to the euphoric levels of the previous week.

Although the pullback has wiped out more than $222 million in market value in the last seven days alone, Avalanche is a target of institutional investors interested in its scalable blockchain infrastructure.

The volume has increased to reach an unprecedented high of $954 million in the past 24 hours, indicating increased interest, though the prices are approaching critical levels of support at around $20.

As Bitcoin is conjoining at an approximate of $92,000 and the overall crypto market cap breaches the entire 3 trillion threshold, the endurance of AVAX through the tempest makes it a potential leader in a recovery among smart contract platforms in the 2022 market.

This decline considers the savage 25.7% weekly drop, less than the global crypto market of 8.6% and other competitors such as Ethereum that dropped only 6.9%. However, beneath what is a better picture of Avalanche than long-term direction, there is an unprecedented $1 billion treasury program and a growing buzz over spot ETF authorisations.

With regulators indicating a willingness to permit crypto offerings, the efficiency of AVAX as a proof-of-stake and subnet network is beginning to be compared with the rocket-propelled growth of Solana, and some analysts are projecting a price recovery to $30 by the end of the month.

$1B Treasury SPAC Deal Ignites Institutional Fire: Nasdaq Listing on Horizon

The catalyst of the day is the aggressive move that Avalanche made to enter the traditional finance by merging with a SPAC worth 675 million, announced earlier this month. Avalanche Treasury Co., which is the sole project of the Avalanche Foundation, is to merge with Mountain Lake Acquisition Corp to form two U.S.-based organisations that would focus on accumulating AVAX tokens.

The transaction, to be finalised in Q1 2026, with a Nasdaq listing, will commence with a $200m discounted token sale, which will target the creation of a treasury worth one billion dollars and potentially chain up the entire supply and stabilise prices.

This action supports the overall strategy that the Foundation has taken to drive institutional adoption, such as gaming subnets and network optimisation.

According to market observers, Avalanche is establishing itself as the enterprise blockchain of choice, as the platform is capable of executing 4,500 transactions per second with sub-second finality – an extreme compared to Ethereum and its scaling issues.

The timing of the SPAC is also perfect, as the SEC just gave the Bitcoin and Ethereum ETFs a green light and directed billions of dollars to legal crypto exposure via these funds. To this effect, FIFA Subnet is coming soon to launch in Q4 2025, which will be the home of NFT tickets and collectibles to the 2026 World Cup.

This high-visibility integration may place Avalanche in the spotlight of millions of users, increasing AVAX requirements in terms of gas charges and staking payments. Even the first adopters, such as DapDap cross-chain bridge, which was launched on October 9 and charges 0.01 per cent to transfer stablecoins, are already facilitating millions of transactions, which highlights the interoperability advantage that Avalanche offers in DeFi.

ETF Hopes and Whale Accumulation: A Buffer to the Dip

To make the optimism even more augmented, AVAX spot ETF interest is soaring. The March 2025 filing by Bitwise is catching fire, and CEO Hunter Horsley underlines quality-driven institutional strategies moving to hold undervalued assets such as Avalanche.

Grayscale has until July 15, 2026, to decide on its ETF, but analysts believe that 75 per cent of this will pass by mid-2026, which could be a repeat of the same Solana inflows that increased to 15 billion.

The addition of AVAX to multi-asset ETF baskets with ETH and SOL solidifies its role as a DeFi infrastructure, as one strategist remarked, noting that NEAR Intents has swapped over $1.84 billion over the last 8 months, proving that the ecosystem is increasingly becoming useful.

Bullish undercurrent. On-chain metrics are being strengthened. Whale wallets have gained 2.3 million AVAX in the last week, which is 1.2% of the circulating supply, and long-term holders currently have 68% of tokens – an increase of 62% in September.

Supply participation in stakes reached an all-time high of 75 per cent, and the APY of 8.2 was achieved, and selling pressure decreased. It reminds me of the Avalanche bull run in 2021, during which AVAX shot up 3000 per cent on comparable institutional purchases.

The chart narrates the technicals of capitulation and then opportunity. AVAX has crashed by 38 per cent in early October, falling between $34 and $21, then has developed a double-bottom at $20, where the RSI has moved out of oversold at 28 to neutral 45.

An upside break of above $24 may aim to hit $30, which is according to the October forecast of between 18.56 and 33.10 and an average of 23.08. CryptoPolitan conservative models project a decline of $29.46 at the end of the year, and bullish models by Lark Davis project a rise of $100 in 2025, provided catalysts in the ETFs are met.

Market Correction Context: Altseason Rotation Favours Scalable Chains

Avalanche is not the only one that is in the red; it is one of a wider range of altcoin rotations as cryptocurrencies take profits amidst overextended gains. CoinDesk 20 Index fell 1.2 per cent, and memecoins such as Dogecoin collapsed 15 per cent following a 35 per cent rise.

However, there are some alternative smart contract platforms, such as AVAX and NEAR, that are performing better relative, with AVAX 24h volume gaining 13.82 per cent despite the price crash – a positive commitment indicator.

The development of the ecosystem supports the story. The upgrades of the codebase in Q3 2025 at Avalanche increased the scaling and allowed a smooth fit with EVM, making large projects such as the migration of the $500 million lending pool at Aave.

Adoption by merchants is also taking off as AVAX runs 12 per cent of cross-border payments on exchanges such as Uphold, due to fees of less than $0.001 and an environmentally friendly consensus that consumes 99 per cent less energy than proof of work competitors.

Risks persist, however. An extended economic downturn or latency by the SEC on altcoin ETFs would extend the correction, which would push AVAX to the support at 18. Greater market sentiment is dependent on U.S. fiscal policy and global trade negotiations and is a wildcard – but the softening of the Ukraine situation and tariff cuts are creating a tailwind.

Prognosis: AVAX Road to $50 in a Post-ETF World

At the end of October, Avalanche is at a crossroad: either a temporary bear trap or the beginning of a breakout? The supply dynamics are favourable to upside with the SPAC opening an additional $1 billion on top of the existing $3 billion that it has in its treasury. In the year 2025, we will be around 28.25 on average prices, with breakouts to 150 possible in 2030, provided the adoption rate picks up.

In the case of traders, the risk-reward is skewed in favor: a high-throughput network with a market value of a $8.9 billion – less than 0.3% of Bitcoin – trading institutional pivots. Avalanche, concentrating on the practical use of tokens, seems like an intelligent gamble in a world of hype-driven tokens. The current 8 per cent decline is painful, yet it is shaping the future growth.