According to James Trautman, the research analyst at Messari Crypto, Even though Avalanche (AVAX) is sandwiched between Terra (LUNA) and Dogecoin (DOGE), the crypto asset still has plenty of room to go. At the time of writing, AVAX is changing hands at $80.61. after slipping by 0.86% in a day but losing 12.03% of its value in the past week.
AVAX/USD 4-hour chart | Source: TradingView
AVAX sandwiched between LUNA, and DOGE gets a chance to launch subnets
2/ Adoption continued as active addresses reached an all-time-high of 140,000 in January.
For perspective, Avalanche had more active users in the first week of January than in all of October 2021. pic.twitter.com/wzUbOawOU0
— James Trautman (@JamesTrautman_) April 12, 2022
In particular, Messari’s report repeatedly emphasizes the importance of subnetting to Avalanche’s ecosystem. In addition to the Ethereum Virtual Machine (EVM) subnet that will enhance interoperability between Avalanche and Ethereum, the launch of the GameFi subnet also caused excitement and activity in the community.
“Crabada quickly passed 5,000 users…Daily transactions grew from 60,000 to over 400,000 over Q1, measured by transactions made to Crabada’s smart contracts”, the report stated.
Keeping this in mind, you should look at Avalanche’s development to see how the metric is doing. However, according to Santiment, developer activity has steadily declined since early March. Regarding adoption, January 2022 is an important month for Avalanche, but now investors need to see when this ATH will pass.
Source: Santiment
No project can be perfect, and Avalanche is no exception. One particular challenge is the total decrease in the total value locked (TVL) value.
“While TVL on Avalanche experienced a slight decline, top DeFi protocols Aave, Benqi, and Trader Joe experienced TVL declines of 4%, 18%, and 20%, respectively. Their collective TVL declined by 12% — more than twice the total Avalanche DeFi ecosystem’s decline”, the report added.
At press time, Avalanche’s TVL has recovered from its January drop but is still well below the levels achieved in 2021. Most recently, Avalanche made headlines when Bloomberg reported that Terra Fund Defender Luna plans to add $100 million in AVAX to the reserve fund for stablecoin TerraUSD (UST).
This is another major project milestone that investors should note as Terraform Labs co-founder Do Kwon reportedly chose AVAX due to “user familiarity.”
Read more:
- Luna Foundation Guard Will Buy $100 Million Worth Of AVAX
- AVAX Price Would Soon Re-Kickstart And Start Setting Records On The Price Chart