Avalanche's AVAX Token Leads Crypto Rally Amid Market Setbacks
Summary:
Avalanche's native token, AVAX, is seeing double-digit growth, trading at a high of $43 despite a downturn in the broader crypto market. The token's value has risen by 123% over the last 30 days, and its market cap has soared by 341% in two months. Other crypto assets within the Avalanche ecosystem are also performing strongly. According to CoinShares, Avalanche continues to see high inflows, indicating sustained interest among investors. Increased developer activity and total value locked (TVL) on Avalanche also signals a positive outlook for the blockchain.
Defying overall crypto market setbacks, the Avalanche ecosystem's intrinsic currency, AVAX, has seen a staggering appreciation in its value, with figures landing in the twofold digits. Breaking past the $40 mark on Dec. 12, AVAX reached an intra-day peak of $43. Presently trading at $38, the layer 1 token has ascended 12% in the past day and 123% throughout the prior month.
The recent surge has propelled the Avalanche's total market valuation to grow from a modest $3.25 billion in mid-October, when the rally first kicked off, to today's impressive $14.35 billion, indicating an impressive growth of about 341% in a meager two-month span. At $1.06 billion ahead of Dogecoin's $13.29 billion, AVAX is now holding the ninth spot on the CoinMarketCap listings. With an increase of 200% over the previous year, AVAX's market cap previously stood at $4.04 billion in December 2022.
Other cryptocurrencies within the Avalanche ecosystem aren't falling behind either. Both the native Avalanche decentralized exchange token JOE (JOE) and Benqi’s liquidity staking token QI have experienced gains of 5% and 20%, respectively, over the last 24 hours. Coq Inu (COQ), a memecoin developed on the Avalanche network, shot up 22% in the same period.
As per James Butterfill's Dec. 11 crypto fund inflows report, despite notable dips in leading cryptos Bitcoin and Ether, both Solana (SOL) and Avalanche saw inflows of $3 million and $2 million. Such sustained interest seems to be propelling Avalanche's rally.
Coupled with a spike in user activity, the fundamentals are bolstering Avalanche’s ascent. Trading above a critical demand zone ranging from $15 to $20, AVAX sees solid downside support from major moving averages. A surge in buying around this support level could potentially trigger an upward trajectory to new annual highs.
The on-chain metrics from IntoTheBlock’s global in/out of the money (GIOM) model reinforce the importance of the $15 to $20 support zone. AVAX appears to sit on robust support compared to the resistance faced upward. For instance, the significant support level at $20 falls within the $18 and 30 price range, which previously saw purchases of approximately 19.62 million AVAX from an estimated 822,020 addresses.
Further positivity surrounding Avalanche stems from total value locked (TVL) data, which mirrors the project’s ecosystem progression. Analysis of TVL data sheds light on investor and developer interest in a blockchain or a decentralized application (dApp). Analogous to bank deposits for decentralized finance (DeFi) projects, TVL can potentially impact the market direction.
Clear indications of a harmonized increase in TVL on the Avalanche blockchain along with the price are evident. DeFi TVL aggregator, DeFiLlama's data reveals that the amount locked on Avalanche jumped from $482.93 million on Oct. 15 - when AVAX price started its rise - to a current figure of $911.12 million, indicating an increase of 90%.
In addition to climbing development activity, large on-chain users are showing a growing demand signal. From mid-October's 44 GitHub commits to 284 on Dec.12, development activity on Avalanche has shown a significant uptrend, according to Santiment. This rise mirrors an increase in network users and, therefore, increased demand for AVAX.
This development activity surge is attributed to the latest developments in the ecosystem. For instance, JP Morgan's blockchain Onyx announced last month about using an Avalanche subnet in a proof-of-concept trial under the Monetary Authority of Singapore's Project Guardian. On Dec. 12, Avalanche announced that popular games creator Mirai Labs is transitioning its ecosystem from Polygon to an Avalanche subnet.
This article steers clear of any investment advice or recommendations. Each investment and trading step carries risks, and readers should engage in their independent research before making any decisions.
Published At
12/12/2023 11:40:42 PM
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