Avalanche (AVAX) price may reach $30 as staking increases.

Avalanche (AVAX) price retested $20 on Monday for the first time since April 2023. Lead cryptocurrency analyst Hitesh Malviya cited the revival of GameFi in the Avalanche ecosystem as a major catalyst for growth and could lead to further AVAX price gains.

Snowboard prices drew investor interest last week, hitting a six-month high of $20. What are the underlying reasons behind this price decline and how far can the bulls drive the rally?

GameFi's reboot is fueling massive adoption and billing.

AVAX's price is up 75% over the past 10 days, making it the second-best performing mega-cap altcoin this month behind Solana (SOL). Looking beyond the broader altcoin market rally, on-chain data revealed the fundamental drivers behind the ongoing AVAX price rally.

Crypto analyst Hitesh Malviya recently told BEncrypto that newly launched GameFi subnets are a major driver of AVAX adoption.

A subnet is a separate blockchain protocol built to work within the Layer 1 blockchain protocol. In the Avalanche ecosystem, these subnets provide validators that different blockchains can share.

Malvia explained in an extensive tweet that Avalanche game subnets like DFK and DEXALOT are running more transactions than Avalanche C Chain.

“Avalanche subnets DEXALOT and DFK are processing more transactions than Avalanche C Chain,” Malviya said.

In practice, this has increased the number of tokens burned as gas bills over the past month.

Avalanche burns 100% of its revenue from transaction fees. And the increased network traction from gaming adoption seems to have accelerated the AVAX burn rate. The chart above shows that the Avalanche network has burned 38,057 AVAX in the last 30 days. Basically, the increase in burn rate on the chart is an indication that price inflation is currently being driven by organic trading activity.

So this suggests that the ongoing AVAX price divergence is due to underlying network activity rather than supporting speculators in the broader altcoin market rally.

Specifically, according to Malvia, new gaming subnets Shrapnel and Loco Legends are billed as “going live soon.” If the DEXALOT and DFK subnets have the same impact, the AVAX price rally could hit historic highs in the coming weeks.

Read more: What is Avalanche (AVAX)?

Avalanche holders and validators held 36 million AVAX tokens in the last 10 days

Avalanche has seen a significant uptick in recent times as its price action is driven by underlying network activity.

“116 new validators have recently been added to the Avalanche network. With a minimum entry requirement of 2000 AVAX for each validator, this means that 232,000 AVAX are held in stock and temporarily withdrawn from circulation,” Malviya said.

On-chain data tracker, StakingRewards, confirmed Malvia's claims, in 2015. As of November 3, 220.2 million AVAX tokens were held in various smart contracts, but that figure quickly increased, hitting 255.91 million AVAX as of November 13.

The graphic below shows that Avalanche holders have moved 36 million AVAX into smart contracts over the past 10 days.

Staking is the process by which cryptocurrency investors stake their assets into smart contracts either to secure the network or to participate in specific ecosystem activities. Adding material during a rally is brutal for many reasons.

First, staking temporarily removes signals from circulation. For example, 36 million AVAX holdings in the last 10 days are worth $720 million at $19. In a strong demand market, such a large supply discount can trigger price increases. Remarkably, AVAX's 75% price divergence over the past 10 days has coincided with a 16% rise in AVAX stock.

With new GameFi projects in the works, Avalanche holders and Node Validators can be incentivized to hold their tokens in stock. If demand remains strong, the AVAX price rally could hit historic highs in the coming weeks.

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AVAX Price Prediction: Could Bulls Reach $30?

From a chain perspective, increasing network activity from GameFi adoption and rising AVAX price rally are the fundamental drivers. While these indicators are still improving, it positions AVAX well for further gains.

Global In/Out of the Money (GIOM) data, which categorizes current Avalanche investors according to their entry price, also confirms this bullish AVAX price forecast.

However, bears need to break the initial resistance at $23 to be sure of retrieving $30. As shown below, 402,470 holders bought 2.95 million AVAX at an average price of $22.98. If those investors exit early, they may experience an AVAX price correction.

But if the bulls can scale the selling wall, the Avalanche's price could recover to $30 as predicted.

Still, the bears could overturn the bullish forecast if AVAX falls below $12. However, in that case, the 771,030 owners who bought 7.97 million AVAX at a minimum price of $14.96 could provide initial support. If those investors HODL firmly, Avalanche prices will avoid a big fall.

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