Ethereum, Solana and Avalanche among altcoins likely to benefit if full implementation rolls out.
The Avalanche (AVAX) cryptocurrency is gaining attention as altcoins pop following a pivotal regulatory decision by the US Treasury and IRS.
As the cryptocurrency market continues to evolve, focus is on key projects and likely bullish breakouts.
In this case, approval of staking for crypto exchange-traded funds (ETFs) could influence market dynamics, and AVAX may be among the tokens to watch.
Avalanche, known for its high-throughput blockchain and robust ecosystem, could experience renewed investor interest amid favorable market conditions.
Currently, AVAX price is at $17.75, and has approached $20, a critical resistance level.
However, the price point is a key psychological and technical barrier after bulls failed to clear on multiple occasions.
Nonetheless, AVAX has demonstrated resilience following the bulls’ plummeting to lows of $16.
Price remaining near the level suggests a succession of green days amid upside volatility will buoy buyers.
Given current bearish sentiment, coupled with global risk asset jitters in recent weeks also suggests the asset may be undervalued. If so, it could present a potential buying opportunity for investors.
That may be the flip point if AVAX strikes and sustains an upward trajectory.
A break above the $20 threshold is key, largely as the correlation that AVAX has with other proof-of-stake (PoS) networks like Ethereum and Solana further bolsters its case.
It is because these assets are expected to benefit from fresh regulatory clarity.
The US Treasury and IRS have introduced Revenue Procedure 2025-31, a landmark decision that establishes a tax safe harbor for crypto ETFs and trusts to engage in staking activities.
This guidance allows regulated funds to stake digital assets such as ETH and SOL while maintaining a pass-through tax status. Analysts say the move eliminates previous legal uncertainties.
While key conditions include holding a single crypto asset type with a qualified custodian and distributing staking rewards directly to investors, it’s a development that could unlock significant capital inflows into PoS networks.
That includes Avalanche, whose native token could tap into institutional participation.
Add anticipated ETF hype, and this could transform staking into a mainstream investment strategy.
The convergence of Avalanche’s price potential and catalysts such as the US Treasury’s stance on crypto staking may turn out extremely bullish for AVAX.
Crypto treasury efforts are also a huge catalyst.
The AVAX price last tested a local peak above $20 when bulls saw a breakout taper out near $35 in September.
