Avax, the native token of the Avalanche ecosystem, has surprised the market by registering double-digit gains amid a decrease in the broader crypto space. The AVAX token broke the $40 barrier on December 12 and reached an intra-day high of $43. At the time of publishing, the Layer 1 token trades at $38, up 12% in the last 24 hours and 123% in the last 30 days.
AVAX’s market cap increased by 341% in two months
The latest rally has seen the Avalanche’s total market cap increase from more than $3.25 billion when the recovery began in mid-October to a current value of $14.35 billion. This represents an increase of over $341% in just two months.
This is $1.06 billion more than Dogecoin’s $13.29 billion, pushing it to ninth place in the CoinMarketCap ranking.
AVAX’s market capitalization has also increased by 200% over the past 12 months, registering $4.04 billion in December 2022.
AVAX is not the only crypto to emerge within the Avalanche ecosystem. JOE – Avalanche’s native token decentralized exchange Trader Joe’s, and QI – the native token of Avalanche’s liquid staking protocol BenQi – are also on the rise with 5% and 20% gains respectively in the last 24 hours.
Coq Inu (COQ), a memecoin built on avalancheIt is also registering an amazing performance after climbing 22% in the same period.
Honestly, I don’t even know when the last time was #AVAX This wild has been launched. $COQ The vibes are very strong here, and 100% initial liquidity is gone, 100% supply is gone, 0 tokens are reserved, 0 tokens are left to mint. Your standards for meme-coins should be so high now.
– Viperxl007 (@Viperxl007) 7 December 2023
Crypto fund flows on December 11th reportJames Butterfill, head of research at CoinShares, wrote that while large companies like Bitcoin and Ether Faced a huge fall in prices This week, Solana (Fifth note of musical scale) and Avalanche saw inflows of $3 million and $2 million respectively, remaining the “favorites” in the altcoin sector.
This interest could fuel the Avalanche’s rally, but what about the upside?
Surge in fundamentals and user activity support Avalanche’s uptrend
Avalanche trades above a key demand zone spanning $15 to $20. Note that this is where all the major moving averages are located, suggesting that AVAX has strong support on the downside.
A rush of buyers around the said support level is likely to provide the necessary tailwind for a move higher. If this happens, bulls may attempt to push the token to new yearly highs as more buyers enter the market.
The Relative Strength Index (RSI) was moving upwards at 89, just inside the overbought zone, which showed that the bulls were in complete control of the price. Moreover, all the major moving averages were situated below the price level and were looking at an upward trend, reinforcing the bullish outlook.
The importance of the support zone between $15 and $20 was supported by on-chain metrics from IntoTheBlock’s Global In/Out of the Money (GIOM) model, which showed that AVAX was relatively bullish compared to the resistance it faced on the upside. Was sitting on strong support. For example, the key support level at $20 lies within the $18 and 30 price range, where approximately 19.62 million AVAX were previously purchased by approximately 822,020 addresses.
Connected, Avalanche was ‘undervalued’ before recording 79% weekly gain – analyst
Further validating the positive outlook for Avalanche was the Total Value Locked (TVL) data that shows the project’s growth within the ecosystem.
Analysis of TVL data helps understand investor and developer interest in blockchain or decentralized applications (dApps). TVL is similar to bank deposits for decentralized finance (DeFi) projects and can influence market direction.
According to the above chart, there is clear evidence that TVL on the Avalanche blockchain is increasing along with the price. data DeFi TVL aggregator DeFiLlama revealed that the amount locked on Avalanche increased from $482.93 million on October 15 when the price of AVAX started rising to its current value of $911.12 million. This represents an increase of 90%.
This increase in TVL is indicative of increasing demand among large on-chain users. This is highlighted by increasing development activity, an on-chain metric used to assess the progress and innovation of cryptocurrency projects.
According to Santiment, development activity on Avalanche has increased from 44 GitHub commits in mid-October to 284 GitHub commits on December 12.
This increase in development activity is also considered bullish as it indicates an increase in network users resulting in increased demand for the AVAX token.
The increase in development activity for smart contract protocols has emerged from the latest developments in the ecosystem. For example, JPMorgan’s blockchain Onyx announced Last month it was using an Avalanche subnet in a proof-of-concept test under the Monetary Authority of Singapore’s Project Guardian.
On December 12, Avalanche announced that Mirai Labs, creator of the popular games Pegaxi and Petopia, was moving its ecosystem from Polygon to the Avalanche subnet.
The Avalanche Evergreen Subnet is an individual blockchain specifically designed to suit the needs of institutions, taking into account network privacy, gas features, and permissioning.
“With its subnet technology, unmatched developer support, and exceptional scalability, Avalanche is becoming known in the blockchain industry as the go-to network for Web3 gaming.”@realcoreywiltonCo-founder and CEO of Mirai Labs, on choosing Avalanche.
– Avalanche (@avax) 12 December 2023
This article does not constitute investment advice or recommendations. Every investing and trading move involves risk, and readers should do their own research when making decisions.
