Avalanche activity spikes, how will AVAX react
- Avalanche observed a spike in growth in terms of activity due to spike in NFT demand and dApp usage.
- AVAX price declined and volatility rose.
Recent data indicated a significant increase in activity on Avalanche’s [AVAX] C-chain, the primary chain responsible for transaction validation and network consensus. As the network gains traction, questions arise regarding the future of AVAX, the native cryptocurrency of Avalanche.
Read Avalanche’s [AVAX] Price Prediction 2023-2024
An Avalanche of users
Token Terminal’s data revealed that Avalanche was steadily progressing towards amassing one million monthly active users on the network. The rising activity indicates a growing user base and increasing utilization of the platform’s capabilities.
One reason for the high activity on the Avalanche network was the rising demand for its NFTs.
According to AVAXNFTSTATS, sales on the Avalanche NFT network experienced a notable surge of 37.5% in the past week. However, it’s worth noting that interest in blue-chip NFTs like Roostr and MONKEEZ declined, suggesting a shift in preferences among NFT enthusiasts.
Coupled with NFTs, dApps on the Avalanche network also played a vital role in increasing activity on the protocol.
Notably, DeFi dApp protocol Benqi witnessed a 3.11% increase in unique active wallets, leading to a subsequent rise in the number of transactions conducted on the network. This highlights the expanding ecosystem of DeFi decentralized applications on Avalanche.
Despite the heightened activity generated by dApps and NFTs, Avalanche has experienced a decline in revenue over the past month, with a notable drop of 14.1%. This decline could be attributed to various factors, such as shifting market dynamics or evolving user behavior.
Realistic or not, here’s AVAX market cap in BTC’s terms
State of the token
In the last month, Avalanche’s price and volume exhibited a downward trend. Coupled with that, the volatility of AVAX has increased materially. This spike in volatility could stop risk averse users from buying AVAX due to increasing price fluctuations.
Avalanche’s new collaborations with Circle could improve the state of the token and attract new users to the protocol. The collaboration ensures the availability of EUROC, a stablecoin issued by Circle. The issuance of EUROC on Avalanche could also help the protocol expand in the DeFi sector, going forward.