Users on Avalanche fall despite efforts: What does it mean for AVAX?
- The number of users on the Avalanche network declined.
- Stakers showed interest in the network, as the development activity increased.
According to a 20 February tweet by Artemis, the overall number of protocols on the Avalanche [AVAX] network increased. However, this spike in the number of protocols on the network did not have the desired effect.
The Block @TheBlock__ cited GokuStats in their Layer 1 Landscape report.
Interesting to see ETH and BNB have the most amount of DeFi protocols but not necessarily largest user base$AVAX has a ton of protocols but fewer users. pic.twitter.com/ZgdHiPaL3W
— Artemis 🏹 (@Artemis__xyz) February 20, 2023
How much are 1,10,100 AVAXs worth today?
Despite the growing number of protocols on the Avalanche network, the overall number of users on the network declined, which, in turn, impacted the revenue generated. According to Token Terminal, it was observed that the revenue collected by Avalanche declined by 18.2% over the last three months.
Another indicator of a decline in interest in Avalanche was the decreasing interest in Avalanche’s NFTs. According to data provided by AVAX NFT STATS, a lot of blue-chip NFTs volume declined over the past month. The decline in NFT interest could also impact the overall ecosystem of Avalanche negatively.
However, despite these developments, the number of stakers on the Avalanche network grew. According to Staking Rewards’ data, the number of stakers on the Avalanche network increased by 30.65% in the last 30 days. At press time, 70,902 stakers were present on the Avalanche network.
No bears in sight for AVAX
Despite the support from stakers, the overall volume for the AVAX token declined. According to Santiment’s data, the volume for the AVAX token fell from 570 million to 433 million in a few days.
These negative factors could be offset by Avalanche’s increasing development activity. which surged over the last few weeks. A high development activity suggested that possible updates might be on their way to their network, which could attract new users.
Despite the decline in users and volume, Avalanche token’s marketcap dominance increased along with its price. This implied that the AVAX token still outperformed other cryptocurrencies despite low users on its protocol.
Realistic or not, here’s AVAX’s market cap in BTC’s terms
However, as the price of AVAX surged, so did its volatility. According to Messari’s data, Avalanche’s volatility increased by 19.2% in the past week. If the volatility of AVAX token increases, the appeal it has on risk-averse investors will decline.