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Avalanche (AVAX) had a poor Q2 2024 performance by several measures, seeing a significant drop in market cap along with declining revenue generation.
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A recent report from Messari noted that AVAX has faced a severe correction after two quarters of consistent growth. The market cap dropped 40% in the last quarter to $11.6 billion. Well, despite this slump, the ecosystem is still as healthy as ever. Avax The company’s market cap remains at $4.5 billion – a 157% increase compared to the same period in 2023.
condition @Avax Q2
Major Update: Several partnerships have been announced, most notably: @tape, @homeumand @konami.
Quarterly metrics 📊
– Staked AVAX ⬆️ 6%
– DeFi TVL (AVAX) ⬆️ 11%
– Stables ⬆️ 13%Read the full report 🔗https://t.co/7xsKIj1ml3 pic.twitter.com/0dSZnfXOVE
— Messari (@MessariCrypto) September 13, 2024
Price outlook shines despite dip
The recession is affecting the larger ecosystem, but the future of AVAX looks brighter. In fact, the token price predictions should give investors hope. AVAX is expected to rise by 70.68% over the next three months, showing a recovery from recent prices, Analysis from CoinCheckup Offers.
This bullish sentiment is reinforced by long-term forecasts that suggest a 166% growth over the next year. AVAX appears poised for a recovery, making it an interesting asset for traders watching the market.
Declining revenue and on-chain activity
Avalanche’s revenue was another concern, falling from 176,700 AVAX in Q2 2024 to 96,200 AVAX over the same period. In dollar terms, this translates to a drop of $7.5 million to $3.5 million.
The decline is due to slowing activity across various blockchain-based platforms. However, some analysts believe that renewed interest in blockchain-based transactions could help revive revenue growth in the near term.
Despite these declines, staking remains strong within the Avalanche ecosystem. There is a 6% increase in the number of AVAX tokens staked due to new measures to boost staking. Staking rewards continue to attract new investors despite a 7% drop in the number of active validators. This reflects some concern among validators amid these market conditions.
Network stability
Average transaction volumes remain mixed. With around 11,262 transactions and an average block time of 1.61 seconds, Avalanche is showing stability. Over 2% of all tokens are sent from the Elliptic Curve Digital Signature Algorithm wallet. Despite the dips, the new initiatives are expected to boost staking and future token balances.
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Interestingly, while the network saw an average transaction volume drop by 57% from 495,000 to 201,500, some protocols on Avalanche refused to follow the trend. Tether (USDT) and GMX increased transaction volumes, suggesting that certain sectors of the system are doing well despite this broad crypto market slowdown.
As AVAX prepares for a potential market rally, its investors may be able to see renewed interest in the asset if this expected price growth materializes.
The partial recovery in transaction volumes for specific protocols also suggests that something else is going on beneath the surface — a sign that Avalanche could rebound quickly once the crypto market recovers. For now, investors are keen enough to keep an eye on how AVAX performs in the near and medium term.
Featured image from Durango.com, chart from TradingView