AVAX One interim CEO Pete Wylie has said $33 million in non-cash charges accounted for most of the company’s $35.1 million second-quarter loss as staking helped revenue rise to $2.8 million.

AVAX One interim CEO Pete Wylie told crypto.news that the reported loss did not capture the operating performance of the company’s staking, mining and digital infrastructure businesses.

“The $35.1 million number can be attention-grabbing, but it does not tell the full story,” Wylie said.

“It includes about $33 million of what are called non-cash charges, most of that being an unrealized markdown based on current prices for the AVAX we continue to hold and accumulate.”

After removing the non-cash items, AVAX One reported an adjusted net loss of $2.2 million for the quarter. Wylie said the adjusted figure provided a clearer view of the operating business, although the company’s reported results remain closely tied to AVAX’s market value.

AVAX One’s loss was driven by digital-asset markdowns

According to AVAX One’s Aug. 13 earnings release, the company recorded a $29.8 million unrealized loss from changes in the market value of its digital assets. A further $2.6 million impairment came from its liquid-staking tokens, while share-based compensation and depreciation contributed approximately $600,000.

Operating expenses reached $36.2 million, up from $1.8 million during the same quarter of 2025. Excluding the $33 million in non-cash charges, AVAX One calculated adjusted operating expenses of $3.2 million.

Net loss reached $4.41 per diluted share, compared with an $8.1 million loss, or $335.88 per diluted share, one year earlier. On the company’s adjusted basis, the latest loss was $0.27 per diluted share.

Although an unrealized loss does not require an immediate cash payment, AVAX One’s results show how a declining token price can reduce the recorded value of its treasury. Wylie acknowledged that volatility is built into the strategy but said staking rewards continue to accrue in AVAX regardless of the token’s dollar price.

“We earn revenue in ‘nominal’ form, AVAX tokens, and though the current value is lower than we expected for this period, if the token price rebounds, we get the benefit as our earned rewards tokens increase in value, even though we recognized initial revenue at a lower price,” he said.

Quarterly revenue rose to $2.8 million from approximately $500,000 a year earlier. Staking supplied about $2.1 million, or 75% of the total, while Bitcoin mining produced approximately $700,000.

As of Aug. 13, the company held 14,091,424 AVAX tokens and equivalents. Approximately 95% of the holdings were staked at an annualized yield of about 5.4%, according to the earnings release.

Around 800,000 AVAX had been deployed into Treehouse. An AVAX One SEC filing describes Treehouse’s tAVAX as a liquid-staking receipt backed by BENQI’s sAVAX, with an AVAX redemption process that can take approximately 14 days.

The filing also lists smart-contract vulnerabilities, extreme market volatility, governance attacks and bridge failures among the risks associated with decentralized finance positions. AVAX One said it would typically absorb losses arising from an adverse event.

Liquidity and debt shape the treasury strategy

Wylie said AVAX One allocates capital according to where management believes each dollar can create the most shareholder value. Depending on market prices and available opportunities, the company can buy AVAX, repurchase its shares, or fund selected infrastructure projects.

“Staking is the foundation of our Avalanche treasury strategy. Our Bitcoin mining operations contribute operating cash flow and provide a gateway for opportunities in the AI and high-performance computing space, an area we are actively exploring.”

During the second quarter, AVAX One repurchased approximately 144,755 common shares under its authorized $40 million buyback program. The company said it had repurchased approximately 417,537 shares since November 2025 on a split-adjusted basis.

Reported liquidity stood at approximately $21.2 million on June 30, down from $27.6 million at the end of 2025. The latest amount included $11.4 million in cash and cash equivalents, $5.4 million in restricted cash, and a $4.3 million escrow receivable.

Given AVAX’s volatility, Wylie said the company remains cautious about its capital structure, particularly debt. After the quarter closed, AVAX One retired and restructured approximately $6.8 million of convertible debt.

The August restructuring fully repaid debentures held by two institutional investors and reduced the principal owed to another investor. AVAX One also agreed to increase a covenant covering the minimum cash and Bitcoin it must maintain from $100,000 to $3.5 million.

For U.S. investors, AVAX One offers public-market exposure to an Avalanche treasury through its Nasdaq-listed AVX shares. The structure also means shareholders face risks from both the company’s operations and changes in the value of AVAX recorded in its U.S. financial reports.

Wylie took over as interim CEO while retaining his chief operating officer role after Jolie Kahn left the company in July. As previously reported by crypto.news, the board retained ZRG Partners to search for a permanent chief executive while weak AVAX prices pressured the company’s treasury strategy.

AVAX One favors explainable yield over higher returns

With most of its AVAX working through staking, the company monitors yield and operating costs as it tries to increase the number of tokens held per share, according to Wylie.

“Our yield partnerships are with established, proven companies. We’d rather earn a yield we can explain than a higher one that seems too good to be true, because it probably is.”

AVAX One’s staking rewards accrue in tokens, leaving their dollar value exposed to changes in AVAX prices. Wylie said management focuses on keeping the assets productive while controlling operating expenses so the treasury can continue accumulating AVAX.

Avalanche’s Helicon upgrade could provide more flexibility if its staking changes progress from testnet to mainnet. Helicon is live on the Fuji testnet and includes proposals to reduce the minimum primary-network validator commitment from 336 hours, or 14 days, to 48 hours.

Another proposal introduces automatic staking renewal, allowing validators to set a cycle period and an auto-compounding ratio. Avalanche’s documentation says the feature applies to primary-network validators, not Avalanche L1 validators or legacy subnet validators.

Wylie said shorter commitments could improve liquidity and reduce the barrier for institutions. Since the changes remain under testing, AVAX One has not yet gained its proposed benefits in its mainnet staking operations.

Avalanche adoption supports Wylie’s treasury conviction

Wylie tied the company’s long-term confidence to institutional activity across Avalanche, pointing to recent deployments involving tokenized securities, lending and stablecoin settlement.

In July, Japan’s Progmat completed the migration of ¥452 billion in issued securities and underlying assets from Corda 5 to a dedicated Avalanche L1. Progmat said the transfer covered all active projects on its platform without disrupting participating financial institutions.

According to Progmat, its platform handles 45 of Japan’s 89 publicly disclosed security-token projects and accounts for 64.6% of the country’s market by issuance value. Internal tests cited by the company found that rights-transfer processing became three to five times faster after the migration.

Aave also deployed V4 on Avalanche on July 15, its first launch of the architecture outside Ethereum. Aave’s documentation says the deployment uses a core liquidity hub with main, foreign-exchange, and AVAX-linked lending sections.

Stablecoin payments supplied another institutional test. Hyundai Card completed a $20,000 remittance pilot between Hyundai Motor entities in the United States and Mexico using USDT on Avalanche. The company said the settlement took about seven minutes.

BlackRock’s BUIDL fund, issued through Securitize, had also accumulated more than $900 million on Avalanche by July after adding approximately $436 million in one week. BUIDL invests mainly in U.S. Treasury bills, cash, and repurchase agreements, while access remains subject to investor eligibility and transfer controls.

Visa added Avalanche to its supported stablecoin settlement networks in 2025. An April 2026 company announcement said Visa’s nine-network stablecoin settlement pilot had reached a $7 billion annualized run rate, although Visa did not provide an Avalanche-specific share of that volume.

Outside its treasury operations, AVAX One is preparing an AI inference pilot at its Redwater facility in Alberta. The project is testing whether approximately 100 kilowatts of excess Bitcoin-mining capacity can support AI workloads, with the company working alongside infrastructure developer BlueFlare on additional AI and high-performance computing opportunities.

Digital Asset and the American Idea Foundation have selected Canton Network for a three-state US benefits pilot scheduled to begin in the first quarter of 2027, subject to federal approval.

Digital Asset and the American Idea Foundation said in a Friday announcement that they will support three states preparing to test the Resources for Independence, Stability, and Employment program, known as RISE.

Former US House Speaker Paul Ryan founded the American Idea Foundation, a Wisconsin-based nonprofit focused on economic policy and programs designed to address poverty. Digital Asset created the Canton Network, which will provide the technology used to distribute and monitor benefits during the pilots.

Subject to federal approval, the first programs are expected to begin in the first quarter of 2027. Neither organization identified the three states, the federal agencies involved in the approval process, nor the benefit programs that would take part.

RISE would combine separate benefit payments

Under the proposed model, states could combine assistance from several programs into one or two payments each month. Digital Asset and the foundation said existing programs often use separate eligibility requirements, reporting procedures, payment dates, and income limits, making them difficult for recipients and agencies to manage together.

RISE would let states assign money to categories such as food, child care, and cash while preserving the rules attached to each program. According to the announcement, the platform could verify a recipient’s identity and participation requirements, provide mobile access, and apply spending restrictions when funds are used.

As household income changes, the system would also recalculate the amount of assistance available to a family. The organizations said the mechanism is intended to reduce sudden losses of support when recipients enter the workforce or earn more money.

Paul Ryan said the pilots would examine whether states can reduce such penalties while keeping benefit programs accountable.

“By combining fragmented benefits, reducing penalties as families earn more, and rigorously measuring results, these pilots can help show what a modern safety net should look like.”

Rather than maintaining separate records for every participating program, authorized agencies would receive access to information covering deposits, purchases, balances, declined transactions, and spending by benefit category. Nonprofit case managers and independent researchers could also view the information permitted for their respective roles.

Digital Asset said government dashboards would show enrollment records, pending approvals, completed tasks, payment eligibility, and the total value of distributed funds. Access would depend on each organization’s permissions, limiting the amount of personal or transaction data visible to parties outside a case.

Canton Network would control data access and payment rules

Canton would coordinate the rules, permissions, and transactions behind each payment while maintaining controls over sensitive information, according to Digital Asset. States could encode individual benefit requirements into the distribution process instead of applying every rule after a payment has been made.

Transaction records would give agencies an audit trail showing how money entered the system and where recipients spent it. Digital Asset said participating governments could use the records to monitor compliance and identify payments that did not follow program conditions.

Yuval Rooz, Digital Asset’s co-founder and CEO, said Canton allows approved participants to coordinate transactions and share rules while retaining the privacy and control required by institutions. RISE would apply the network’s existing permission system to public-benefit administration rather than capital-market settlement.

The evaluation phase is expected to track employment, earnings, benefit use, education, training, housing, and household stability. According to the announcement, governments and independent evaluators would receive transaction and compliance data during the program instead of relying only on later reviews.

Results from the first three states would inform further pilots. The organizations said later versions could be adapted to different state rules, case-management systems, benefit structures, and groups of recipients, although they did not provide a schedule for additional deployments.

Canton has tested private payments and government bonds

Canton’s earlier projects have concentrated on regulated financial transactions that require participants to share selected information without publishing complete records on a public ledger.

In June, crypto.news reported that Visa and Brale had begun a private stablecoin settlement test using SBC, Brale’s US dollar-backed token. The proof of concept examined whether financial institutions could settle payments while restricting confidential transaction data to involved parties and authorized regulators.

Four Mitsubishi UFJ Financial Group companies launched a Japanese bond repo trial in August with Digital Asset and Progmat. The participants are testing automated processing and real-time settlement for transactions backed by Japanese government bonds.

Supported through Japan’s Financial Services Agency Payment Innovation Project, the MUFG test also covers the possible use of tokenized deposits or stablecoins for the payment side of repo trades. A separate April trial involving Japan Securities Clearing Corporation, Mizuho, Nomura and Digital Asset examined whether Japanese government bonds could move as digital collateral while retaining their status under the country’s existing laws.

Institutional access expanded again in August when Interstice Digital introduced a cross-chain swap engine connecting Canton with Ethereum, Solana, and Robinhood Chain. FalconX supplies liquidity for the system, while Interstice said its structure does not require the company to hold users’ assets.

Canton Coin gains a direct US investment route

For US investors, Canton Network already has a connection to the regulated securities market through 21Shares’ exchange-traded fund. The asset manager launched the Nasdaq-listed Canton ETF under the ticker TCAN in May, giving brokerage customers exposure to Canton Coin without requiring them to hold the token directly.

21Shares listed the fund with a 0.50% gross expense ratio and described it as the first US ETF tied to Canton Coin. The issuer said institutions including Goldman Sachs, Microsoft and Deutsche Bank had participated in network testing, validation or governance, while cautioning that their involvement did not amount to an endorsement of the token or ETF.

Canton Coin, used to pay transaction fees through the network’s Global Synchronizer, was trading near $0.107 on Aug. 21. Market data showed a capitalization of about $4.2 billion, a 23rd-place cryptocurrency ranking and a gain of roughly 9% over the previous seven days.

Bitget CEO Gracy Chen has put the chance of the U.S. government buying Bitcoin for its strategic reserve before President Donald Trump leaves office at close to zero.

Speaking in a recent interview, Bitget CEO Gracy Chen said the U.S. government is unlikely to begin buying Bitcoin for its strategic reserve within the next two years.

“From a policy perspective, it’s probably unlikely,” Chen said. “I just don’t see it coming right now.”

Chen said buying Bitcoin would require a more substantial policy decision than retaining assets already controlled by the government. Lawmakers and political parties would need to debate how any purchase program would work, particularly if public money or changes to federal accounting were involved.

Her assessment places the focus on the reserve’s funding rules rather than the administration’s public support for crypto. Trump created the reserve in March 2025, but the order did not provide money for regular purchases on exchanges.

Bitcoin reserve rules limit direct government purchases

President Trump signed the March 2025 executive order establishing the Strategic Bitcoin Reserve and the U.S. Digital Asset Stockpile on March 6, 2025.

Under the order, the Treasury Department must maintain custodial accounts for Bitcoin that has been finally forfeited through criminal or civil proceedings or received through civil penalties. Federal agencies were also instructed to review their holdings and report eligible assets to the Treasury.

Bitcoin transferred into the reserve “shall not be sold,” according to the order, although existing laws allow exceptions for court orders, victim restitution, law enforcement operations and certain asset-forfeiture requirements.

The White House did not completely prohibit the government from obtaining more BTC. Instead, the order directed the Treasury and Commerce departments to develop acquisition strategies that are budget-neutral and impose no additional costs on taxpayers.

No funding mechanism or purchase schedule accompanied the directive. Any plan involving new federal spending would require congressional authorization, while alternatives such as revaluing U.S. gold certificates would face separate legal and political hurdles.

An August reserve policy explainer from crypto.news said gold revaluation has been discussed as one possible funding route. Federal Reserve gold certificates are recorded at a statutory price of $42.22 per ounce, far below the metal’s market value, but using the difference to finance Bitcoin purchases would require legislation.

The reserve removes supply without adding demand

Public estimates have commonly placed U.S. government holdings near 198,000 BTC, equal to about 1% of Bitcoin’s circulating supply. The estimate includes coins connected to major forfeiture cases, though the government has not released a complete public audit confirming how much BTC has been finally forfeited and is eligible for the reserve.

The distinction between seized and forfeited assets matters because the government does not necessarily own every coin held in a federal wallet. Seized assets may remain subject to court proceedings, restitution claims, or eventual return to victims, while finally forfeited assets can become federal property.

At Bitcoin’s recent price near $78,000, a 198,000 BTC position would be worth about $15.4 billion. Its main market effect comes from the order’s prohibition on sales rather than an expected stream of government purchases.

Before Trump established the reserve, the U.S. Marshals Service regularly auctioned Bitcoin obtained in criminal cases. The government sold about 195,000 BTC before the reserve order, according to White House estimates, and administration officials argued that earlier sales cost taxpayers billions of dollars in unrealized gains.

Removing a large federal position from potential sale reduces one known source of market supply. It does not provide the recurring demand that would come from Treasury purchases made at set intervals or price levels.

Bitcoin investors initially expected the reserve announcement to support active accumulation, but the order stopped short of creating such a program. The market’s response therefore depends more on whether the administration identifies a lawful, budget-neutral funding method or Congress passes separate legislation.

Treasury has previously ruled out active Bitcoin buying

Treasury Secretary Scott Bessent gave a similar account of the government’s plans in August 2025, when he said the reserve would grow through confiscated assets rather than direct purchases.

“We’re not going to be buying that [Bitcoin], but are going to use confiscated assets and continue to build that up,” Bessent told Fox Business, adding that the government would “stop selling” its holdings.

A June review of the reserve reported that Bessent valued the federal position at between $15 billion and $20 billion at the time. The report also noted that the executive order asked officials to examine budget-neutral acquisition methods without authorizing an open-market buying program.

Congress could replace the current arrangement with a statutory reserve. Senator Cynthia Lummis’s BITCOIN Act proposed purchasing 1 million BTC over five years, while the American Reserve Modernization Act, introduced in May 2026, proposed a 20-year holding period without retaining the same 1 million BTC target.

Neither proposal has created an active federal purchase program. Congressional approval would also provide firmer legal protection than an executive order, which a future president can amend or revoke.

U.S. investors still face an uncertain reserve balance

For American investors, the reserve does not offer direct exposure comparable to shares in a spot Bitcoin exchange-traded fund. Its immediate relevance lies in federal supply management because the order limits when reserve coins can return to the market.

Public wallet trackers cannot determine the exact size of the reserve. Some services count Bitcoin held in government-linked addresses even when ownership, forfeiture status, or restitution obligations remain unresolved.

Federal custody activity can add to the uncertainty. In July, U.S.-linked wallets transferred nearly $297 million in seized Bitcoin and Ether to Coinbase Prime, including about 3,940 BTC valued at roughly $244 million at the time and 30,000 ETH worth about $53 million.

Coinbase Prime provides custody and trading services, so the transfers did not confirm a sale. Galaxy Research head Alex Thorn linked the Bitcoin to seizures involving Ryan Farace and the closed BTC-e exchange, while the Ether came from wallets tied to a separate federal case involving crypto storage and money laundering.