Avalanche from the lens of subnets: AVAX traders should know that…
- Avalanche charges through the 500 million transaction milestone.
- Avalanche subnets have been a critical aid to this achievement.
Avalanche recently celebrated a significant transaction milestone. But perhaps what was even more interesting was the reason behind this transaction growth and what it means for the future of the network.
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Avalanche subnets have been pivotal in securing the network’s growth and offering an advantage over its competition. According to recent data, Avalanche has so far achieved over 500 million transactions.
Subnets played an important role in achieving this milestone. This is because of the advantages they provide, such as security, scalability, and fast speeds.
— Kristian Peter (@kristianpeter) July 4, 2023
While subnets have been pivotal to Avalanche’s growth, they are subject to risks, especially those associated with smart contracts. The network has been looking into overcoming such challenges and a recent announcement highlighted its efforts.
Avalanche was currently exploring verified smart contracts as a solution. These will reportedly offer more security since they will go through comprehensive verification tests and checks to assess potential vulnerabilities. The verified smart contracts could further boost user confidence and support more utility and transactions.
Avalanche transactions fell sharply in 2022 but have been recovering on a year-to-date basis. They have particularly been on the rise in the last four months. Avalanche transaction count is yet to recover to 2021 and 2022 highs despite the recent growth.
Will the growing Avalanche transactions support AVAX recovery?
Avalanche’s native cryptocurrency AVAX traded at $12.67 at press time. This price tag represented a 27% upside from its lowest price point in June. However, it is still near the bottom range but recently ran out of bullish momentum.
AVAX’s Money Flow Index (MFI) indicator revealed that the cryptocurrency has been experiencing some outflows since the start of July. On-chain data revealed a dip in both development activity and social dominance.
These observations suggested that we may see more price weakness in the coming weeks unless market confidence makes a comeback.
However, Avalanche’s development activity metric maintained healthy activity in June. A dip in the last week of the month followed by a rapid recovery was observed. However, the development activity recently dipped again at the start of July, possibly contributing to lower confidence.
Read Avalanche’s [AVAX] price prediction 2023-24
AVAX’s price action has mostly been moving in tandem with the rest of the crypto market due to a strong correlation. This means that reports of subnets contributing to growth may not necessarily have an impact on trader sentiment in the short term.