Avalanche (AVAX) posts triple-digit monthly gains as TVL increases indicate user growth.
A native of the Avalanche ecosystem, AVAX surprised the market. AVAX token broke the $40 barrier on December 12 and reached $43 intraday. At the time of going to press, the Layer 1 token is trading at $38, up 12 percent over the past 24 hours and up 123 percent over the past 30 days.
AVAX's market cap has surged 341 percent in two months.
Since the recovery began in mid-October, the Avalanche's total market capitalization has risen more than $3.25 billion to a current rally of $14.35 billion. This represents an increase of over 341% in two months.
This is $1.06 billion more than Dogecoin's $13.29 billion to secure ninth place in the CoinMarketCap rankings.
From its December 2022 record of $4.04 billion, AVAX's market capitalization has increased 200% over the past 12 months.
AVAX is not the only crypto on the rise in the Avalanche ecosystem. JOE (JOE) — Avalanche's decentralized exchange Trader Joe and QI — the native token of Avalanche's liquid staking protocol Banky, have also increased by 5% and 20% in the last 24 hours.
Coq Inu (COQ), the memecoin built on Avalanche, is recording an impressive performance after climbing 22% over the same period.
In fact, I don't even know the last time #AVAX started this wild. The $COQ swing here is very strong, and has been burned with 100% initial liquidity, 100% supply initiated, 0 tokens reserved, 0 tokens left to mint. Your levels of Meme-coins should now be this high.
The… pic.twitter.com/3Ohw8p7tA4
— Viperxl007 (@Viperxl007) December 7, 2023
In a Dec. 11 crypto fund flow report, CoinShares head of research James Butterfill said that while major price drops like Bitcoin and Ether suffered this week, Solana (SOL) and Avalanche gained $3 million and $2 million, respectively, in the altcoin sector “firmly.” Favorites”.
This desire may have fueled the Avalanche's rally, but is the revelation over?
Fundamentals and increased user activity support Avalanche's growth
Iceberg trades above the necessary demand area, which ranges from $15 to $20. Note that this is where all the major moving averages lie, suggesting that AVAX will find strong support on the downside.
A buyer's squeeze around the indicated support level may provide the tailwind needed to move higher. If this happens, the bulls may try to push the token to new yearly highs as more buyers enter the market.
The Relative Strength Index (RSI) has been trending higher in the overbought region of 89, with the bulls in full control of the price. Additionally, all major moving averages are sitting below the price and are trending up, adding credence to the bullish outlook.
The importance of the support zone between $15 and $20 is supported by Chain Metrics from IntoTheBlock's Global In/Out of Money (GIOM) model, which shows that AVAX is sitting on relatively strong support compared to the resistance it faces on the upside. For example, the major support level at $20 is in the $18 and $30 price range, with approximately 19.62 million AVAX previously purchased at 822,020 addresses.
Related: Avalanche Was ‘Undervalued' Before Posting 79% Weekly Gain – Analysts
Further confirming the positive outlook for Avalanche is Total Value Locked (TVL) data reflecting growth in the project ecosystem.
TVL's data analysis helps investors and developers understand the demand for blockchain or decentralized application (dApp). TVL Decentralized Finance (DeFi) projects are similar to bank deposits and can influence the direction of the market.
According to the table above, there is clear evidence that the TVL on the Avalanche blockchain is increasing with the price. According to data from DeFi TVL aggregator DeFillama, the amount locked in Avalanche has grown from $482.93 million on October 15, when the value of AVAX began to rise to its current value of $911.12 million. This represents a 90% growth.
This increase in TVL is a sign of increasing demand among large users on the chain. This is an on-chain metric used to evaluate the growth and innovation of cryptocurrency projects, which is highlighted by increasing growth activity.
According to Sentiment, development activity on Avalanche decreased from 44 GitHub commits in mid-October to 284 GitHub commits on December 12.
As this increase in growth activity indicates an increase in network users, the increase in demand for the AVAX token is considered bullish.
Increased development activity for the Smart Contracts protocol has emerged from recent developments in the ecosystem. For example, JPMorgan's blockchain Onyx announced last month that it will use the Avalanche subnet in a proof-of-concept test under Singapore's project watchdog Financial Authority.
On December 12, Avalanche announced that Mirai Labs, creator of popular games Pegaxy and Petopia, is moving its ecosystem from Polygon to the Avalanche subnet.
The Avalanche Evergreen Subnet is an individual blockchain designed to meet the needs of institutions with a special focus on network privacy, gas features, and permissions.
“With its subnet technology, unmatched developer support and unique scale, Avalanche has become the go-to network for web3 games in the blockchain industry.” @RealCoreyWilton, co-founder and CEO of Mirai Labs, choosing Avalanche.
— Avalanche (@avax) December 12, 2023
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
