The AVAX ecosystem is set to receive a $10 million boost from the Avalanche Accelerator Colony Lab. As part of this collaboration, Colony Lab will establish a network validator and invest in an index tracking leading Avalanche projects. Following this announcement, the native token of Colony Lab, CLY, experienced a surge in its price.
Colony Lab announced its Avalanche investment, CLY took flight!
Colony Lab, a developer and accelerator within the Avalanche ecosystem, unveiled its $10 million investment commitment to support the network’s long-term growth. Over the past few months, the company has acquired over 500,000 AVAX tokens, totaling $8 million. It has now disclosed that these funds will be utilized to establish a validator program benefiting AVAX holders. Validators play a crucial role in maintaining security, confirming new transactions sent to the blockchain in a proof-of-stake (PoS) consensus model. They achieve this by staking their tokens, typically earning rewards in the process.
Additionally, Colony Lab will invest in the Colony Avalanche Index (CAI), a token index within the Avalanche ecosystem that provides returns on assets such as AVAX and Trader Joe’s (JOE). The fees generated from mints or redemptions will be distributed to CLY token stakers. Rewards from both existing and upcoming validator programs will be directed to the CLY staker community. While this news has not yet impacted the AVAX price, it notably propelled the price of CLY. Following the announcement, CLY saw a sudden increase from $0.1135 to $0.1617 during the day.
We are also developing the long-term potential of AVAX!
Avalanche has been making frequent headlines lately with its series of partnerships, and this investment follows suit in the wake of these collaborations. Elie Le Rest, the CEO of Colony Lab, shared insights on the matter, stating, “By making a $10 million investment in the Avalanche ecosystem, we are not only growing Colony Lab but also enhancing the long-term potential of AVAX.”
Interestingly, the investment news propelled the price of Colony’s native token, CLY, while it didn’t have a direct impact on the AVAX price. At the time of reporting, Avalanche (AVAX) was trading at $21 with a daily decline of 4%. However, looking at the weekly chart, AVAX boasts a gain of over 19.5%. Le Rest’s comments reflect a strategic move to foster both the growth of Colony Lab and the broader potential of AVAX, emphasizing a commitment to the sustained development of the Avalanche ecosystem through this substantial investment.