AVAX One, a crypto lender holding $88 million in Avalanche tokens, has raised its minimum liquidity requirement from $100,000 to $3.5 million — a 35-fold jump — after the departure of CEO Jolie Kahn triggered a default on a key-person covenant. The move comes as the company restructures its debt and faces a 180-day deadline to appoint a permanent CEO.
Why the liquidity bar moved
The new requirement only counts bank cash and Bitcoin held in custody. Avalanche tokens, which make up most of the company's holdings, don't count. That's a sharp shift for a lender that built its book around AVAX.
It's also a big ask. The previous minimum was a hundred grand. Now it's $3.5 million. That's not a rounding error for a firm that's been selling off assets to stay liquid.
The CEO exit and its cost
Kahn left the company, and that departure hit a key-person clause. Before she left, Kahn had pivoted the business from agriculture to digital assets under the AgriFORCE moniker. Since her exit, shares have fallen about 42% to $3.20.
The stock price tells you how the market sees the risk. A 42% drop in a few weeks isn't just a bad day — it's a vote of no confidence.
Debt moves and new terms
AVAX One retired $6.8 million in outstanding principal debentures. The investor waived the breach after AVAX One paid $1.3 million and accepted tougher conditions.
Here's the tricky part: the remaining debenture principal was raised to $8.47 million from $7.7 million before the $1.3 million payment, with a $770,000 increase unexplained. After the payment, about $7.42 million remains outstanding.
Monthly redemptions have doubled to one-tenth of original principal from one-twenty-fifth. The accelerated conversion price is now 82.5% of a benchmark tied to the three lowest trading prices over the previous 10 trading days, down from 85%.
What happens next
AVAX One has 180 days to find a permanent CEO acceptable to the lender. Peter Wylie Jr. is the interim CEO for now.
The clock is ticking. Whether the lender accepts the next candidate — and whether the company can meet that $3.5 million liquidity bar — are the two questions that will shape the next few months.
