- Avalanche’s user activity surged by 154% due to advancements in DeFi and stablecoins.
- Collaboration with Cercia and potential AirDrop drove interest in Avalanche.
Apart from Arbitrum [ARB], the Avalanche [AVAX] protocol has observed the most significant growth in terms of user activity since the beginning of 2023.
Read Avalanche’s [AVAX] Price Prediction 2023-2024
Avalanche shows dominance in DeFi
On 28 May, Twitter handle @Flowslikeosmo revealed an impressive 154% increase in users on Avalanche since the beginning of the year.
$AVAX users have increased +154% YTD.
But what is causing this increase in activity?
5 charts to explain the growth of @avax. 🧵 pic.twitter.com/9Tjq9CVhZ2
— Emperor Osmo🧪 (@Flowslikeosmo) May 28, 2023
This steady rise in user numbers can be attributed primarily to the thriving DeFi and stablecoin sectors, which accounted for approximately 34% of all on-chain activity within the protocol.
Source: Artemis
Leading DeFi protocols, such as BenQi and GMX, played a significant role in driving the growth of Avalanche. Recent data from DappRadar indicates a sharp surge in unique active wallets associated with these protocols over the past week.
Additionally, the number of transactions within the BenQi protocol witnessed a notable 12.29% increase during this period.
Source: Dapp Radar
Could things turn around in the future?
However, it is important to acknowledge that AirDrop hunters could fuel activity further. Rumors surrounding an upcoming AirDrop by Layer Zero labs, strongly linked to Avalanche, may have driven this surge in activity. If the anticipated AirDrop materializes, it could potentially result in a decline in activity.
However, despite the significant surge in user activity, AVAX, Avalanche’s native cryptocurrency, has not reflected this growth. Its price has declined and fluctuated within the range of 15.49 and 13.68 levels over the past few weeks.
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During this period, the On-Balance Volume (OBV) metric experienced a notable decrease. However, there has been a positive development indicated by the growth of the Awesome Oscillator indicator, which reached a value of 0.14.
Source: Trading View
Looking ahead, Avalanche’s recent collaboration with Swiss FinTech firm Cercia holds the potential to positively impact AVAX’s price. As the protocol continues to enhance its ecosystem and attract partnerships, its growth trajectory remains an area of interest for investors and enthusiasts alike.
