AVAX’s new milestone means little for investors because…
- Avalanche achieves yet another user-related milestone.
- AVAX bulls demonstrate dominance in the last 2 weeks.
Avalanche has seen significant growth in daily and monthly active users as has been the case for most top blockchain networks. But, Avalanche stood in a noteworthy position as of 27 June because it just achieved a new milestone.
Read about Avalanche’s [AVAX] price prediction 2023-24
Recent data revealed that the Avalanche network managed to surpass its previous monthly active addresses milestone. In other words, the network’s monthly active addresses just achieved a new ATH at 1.21 million addresses.
An unsurprising achievement considering that the market regained volatility in June. It has achieved this milestone despite a few days remaining before June’s conclusion.
This milestone confirmed that Avalanche had indeed been benefiting from healthy growth in the last few weeks. But just how much of this address activity is new or recurrent? DeFiLama data revealed that most of DeFi users (over 70%) on Avalanche were recurrent users. The remaining proportion were new users.
Is Avalanche still operating below its potential?
Avalanche’s address growth, at the time of writing, didn’t necessarily reflect on other measures of growth. For example, its volume levels were still relatively low despite experiencing some stimulation in the last few weeks. Also, Avalanche’s TVL was still at a fraction of its peak value recorded in May 2022.
We can consider that Avalanche still has a lot of wiggle room for growth based on its historic data. However, this does not necessarily mean that it will yield the expected outcome. The surge in monthly active addresses should in theory be reflected in the demand for Avalanche’s native cryptocurrency, AVAX.
Despite the relatively low volume, AVAX has been bullish since bottoming out on 10 June. This is after previously enduring a heavily bearish period since the second half of April. This new monthly active addresses peak has occurred at an important time when the cryptocurrency has been recovering. But is it a sign that AVAX is headed for more upside?
The future of any cryptocurrency, especially in the short term, is still shrouded in mystery. However, the fact that Avalanche was registering record number of monthly addresses might be a start, potentially pointing towards more recovery in the days ahead. AVAX exchanged hands at $13.25 at the time of writing.
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It is worth noting that the ongoing rally started after the price briefly dipped into oversold territory. The Money Flow Index (MFI) showed signs of a slowdown in accumulation. As such, the price was also experiencing lower demand in the market, hence some sell pressure was taking place.