Gauging the impact on Avalanche as Stars Arena CEO steps down
- Activity on Stars Arena dropped as its CEO stepped down.
- Daily transactions on Avalanche declined, price movement remained positive.
The Social Fi sector has been booming over the last few months. This growth was spearheaded by friends.tech, a Social Fi platform on Coinbase’s [COIN] network Base. However, Avalanche’s [AVAX] Stars Arena soon capitalized on this momentum as well.
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The fault in our “Stars”
Stars Arena, a project on the Avalanche blockchain, shared that their CEO, Chill Pill, has stepped down. This drop may be due to a recent hack on the Stars Arena protocol.
The hack took place on 7 October and led to a loss of nearly $3 million. The hack on Stars Arena could hurt people’s trust in both Stars Arena and Avalanche.
As of today, Chill Pill has stepped down from his role as CEO.
We will continue to take significant steps towards rebuilding trust with our community.
— Stars Arena (@starsarenacom) October 29, 2023
Thus, it’s important for these projects to fix the issues and show they’re taking steps to prevent this from happening again to help restore trust.
Due to these factors affecting the Avalanche ecosystem, the activity on the protocol has taken a hit. According to Artemis’ data, the number of daily active users on the protocol have plummeted.
Additionally, the Daily Transactions occurring on the network have also fallen. When fewer people use the network and there are fewer transactions, it can mean that confidence in the network has dropped. It can also impact overall growth and adoption.
On top of this, the total value locked (TVL) on Stars Arena dropped to under $330,000 from its peak of $2.8 million.
Despite the overall network facing difficulties, the price of AVAX surged by 2.87% over the last 24 hours. The volume of AVAX tokens being traded also surged during this period.
Realistic or not, here’s AVAX’s market cap in BTC’s terms
Moreover, AVAX’s Development Activity rose, showing that more people were working on improving the Avalanche protocol at press time.
Increased Development Activity is a good sign. It shows that more people are trying to make the network better, which can lead to improvements and new features in the future.