AVAX USDT Battles To Hold $12: Will SEC-Avalanche Crypto Friendship Save AVAX Price?

Core Insights - Avalanche (AVAX) has experienced a significant decline of -91% from its all-time high of $158 in early 2022, with a recent drop of -4.2% [1] - The token has fallen from being a top 15 cryptocurrency by market cap to 32nd, with its valuation decreasing from over $30 billion to $5.3 billion [2] Regulatory Developments - Ava Labs, the developer of Avalanche, recently met with the US SEC to discuss regulatory oversight of crypto assets, particularly protocol tokens [3] - The meeting included representatives from Ava Labs, Sidley Austin LLP, and the Blockchain Association, focusing on regulatory challenges and potential pathways for harmonizing crypto oversight [4] - A proposed two-part regulatory approach suggests that the SEC would classify initial token sales as investment contracts, while the CFTC would regulate tokens functioning in live systems as commodities [5] Industry Perspectives - Ava Labs and its partners emphasized the need for regulatory clarity on protocol tokens, consistent disclosure, and responsible innovation to protect investors [6] - Despite the ongoing price decline of AVAX, the meeting with the SEC is viewed as a potentially positive sign for the future of crypto regulation [6] - As of mid-December, AVAX trades around $12.5, maintaining above a long-standing demand zone, with historical support at this level [7]