The Avalanche Foundation plans to repurchase these tokens for $45.5 million, while their current market value is approximately $57.4 million.

The repurchase amount is based on the volume-weighted average price of AVAX over a seven-day period in early August 2024.

This repurchase aims to ensure compliance with the original agreement's restrictions and protect the tokens from complications arising from the bankruptcy liquidation process of Terraform Labs.

The agreement to repurchase the tokens is subject to approval from the bankruptcy court overseeing Terraform Labs' estate, which has begun winding down operations following a settlement with the SEC.

The settlement will help reduce litigation costs and preserve more assets for distribution to creditors.

In 2022, the Avalanche Foundation sold 1.97 million AVAX tokens worth $100 million to Terra’s foundation before its collapse.

Following the announcement of the repurchase deal, the price of Avalanche's token increased over 13%, from a low of $25.16 to about $28.50.

The collapse of the Terra ecosystem in May 2022 raised uncertainties regarding the future of the AVAX tokens held by LFG.

The rise in Avalanche's token price is also attributed to the popularity of the new video game 'Off The Grid,' which features an in-game economy based on Avalanche's technology.

The Avalanche Foundation's buyback of AVAX tokens and the upcoming Avalanche 9000 upgrade have positively influenced investor sentiment.

The Avalanche Foundation has initiated a deal to repurchase nearly 2 million tokens sold to the Luna Foundation Guard (LFG) in a $100 million transaction from April 2022, pending court approval.

Originally valued at $100 million, the tokens are now worth approximately $56 million, reflecting a 44% decrease in value since the sale.