Key Insights:
- Avalanche network activity reached new highs in Q4 of last year, with daily transactions across all layers surging to an average of 38.2 million. However, Avalanche price (AVAX) did not perform too well.
- Real-world asset (RWA) integration grew by nearly 950% year over year as BlackRock tokenized $500 million through its BUIDL fund.
- The network successfully decoupled usage from token price as native AVAX fees rose by 25%.
The crypto market tends to link the success of a blockchain to the price of its native currency. However, recent data from the Avalanche network indicates that this isn’t always the case.
During the final quarter of last year, the crypto market faced a harsh environment that saw its market cap tumble by trillions. Most cryptocurrencies saw declines in both price and interest. However, Avalanche price showed a rare strength by expanding its footprint while its market cap fell.
Avalanche Price Defies Bear Market with on-Chain Growth
Messari noted in a recent report that while the Avalanche price dropped by 59% during Q4, the actual work happening on the blockchain exploded. Daily transactions on the C-Chain reached 2.1 million, and this represented a 63% increase from the previous quarter.
This surge proves that people are using the technology for more than just price speculation.
Fees paid in native AVAX also increased by nearly 25% during this period. This showed that demand for block space remained high, regardless of external market conditions.
This is without mentioning that on October 10, a sudden market crash wiped out billions in capital. However, this event alone generated over $520,000 in transaction fees for Avalanche. Moreover, it marked the network’s highest single-day revenue in nearly two years.
Institutional Giants and Real World Asset Expansion
BlackRock recently changed the game for the ecosystem by launching its BUIDL fund on the network. This move tokenized $500 million in assets directly on the blockchain, and such a massive commitment from the world’s largest asset manager indicated a new era for Avalanche.
Real-world assets became the fastest-growing sector for the platform late last year. Besides, total value locked in these assets jumped 68.6% in just three months.
With all of this being said, financial institutions are now using Avalanche price to build permanent infrastructure. FIS recently partnered with Intain to bring tokenized loan markets to the platform. This allows approximately 2,000 US banks to trade and settle billions of dollars in loans almost instantly.
S&P Dow Jones also joined the movement by introducing the S&P Digital Markets 50 Index.
Global Adoption and the Rise of Layer 1 Networks
Expansion has not been limited to the United States either. For example, in Japan, the Progmat platform migrated more than $1.1 billion in tokenized securities to a dedicated Avalanche L1.
TIS Inc. also launched a multi-token banking platform through AvaCloud services. These regional developments helped push the average daily active addresses to 24.7 million, and represent a staggering 16,360% increase compared to the previous year.
Much of this growth stems from telecom networks in Asia onboarding millions of new users.
Avalanche Price Stands Its Ground
According to the charts, Avalanche price is trading at around $10.59 as of writing, after breaking below the $11.42 support. The Fibonacci retracement tool shows that the $10.6 price level is an important support floor. Besides, any break below it could lead to a dip towards $6.17.
If the $10.6 price level holds and AVAX rebounds, investors could see a move towards $13.10.
However, the RSI shows a reading of 28/100, indicating that AVAX is trending towards oversold territory. While this shows that the bears currently have the upper hand, it could be a positive signal for the long term once these bearish investors lose steam.
Investors should adopt a wait-and-see approach from here and watch how AVAX behaves around $10.6 before entering. Coinbase Insider Trading Lawsuit Survived Delaware Judge’s Dismissal Ruling