The AVAX token is up 125% over the past week with both BTC and ETH saw larger retracement since the recent highs of $42,000 and $1350 with both now settling, but why did Avalanche’s token surge? Let’s try and find out in our altcoin news today.
Some cryptocurrencies were not shaken by the drops and one such coin was AVAX. The cryptocurrency gained almost 130% in the past seven days and according to the data, it became one of the top-performing crypto assets on a daily basis. While the cryptocurrency is outpacing most digital assets, now too many people know what Avalanche really is. Avalanche is a decentralized application network that operates just like polkadot. Its technology allows developers to deploy blockchains that fit certain needs and can interoperate with other blockchains and create a comprehensive ecosystem. Ava Labs which is the main developer behind the protocol is backed by Polychain Capital, Andreessen Horowitz, and Initialized Capital.
The project was founded by Emir Gun Sirer who is a Cornell University professor who followed BTC and ETH and the rest of the crypto asset market. The AVAX token is the network’s native token and it is used to pay transactions on the Avalanche network. The token is scarce and hard-capped which means it is burned when used. AVAX could be benefiting from the ongoing ETH network congestion which disallowed users from using the network. Mark Cuban for example said that the believes Aave and other DeFi platforms are hard to use because of the gas fees.
Other alternatives like Polkadot and Loopring surged over the past week alongside AVAX and discounted the crypto market correction. Avalanche is a multi-purpose blockchain but it seems that decentralized finance is and will be the main focus for developers. Developers announced a Uniswap-based automated market maker for Avalanche back in 2020:
“Pangolin is a decentralized exchange (DEX) which runs on Avalanche, uses the same automated market-making (AMM) model as Uniswap… In a crowded marketplace with multiple contenders, Pangolin offers three critically important benefits: fast and cheap trades, community-driven development, and a fair and open token distribution.”
The announcement was shared by both Emin Gun Sirer and the Avalanche team. Other projects that launch Defi-based apps on Avalanche include Reef Finance. Avalanche is now 48th by market cap and increased 23.9% in the past day.
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Stefan has been writing articles for DCForecasts since 2016 in-house full time. As one of our main cryptocurrency writers, he focuses on covering the latest cryptocurrency news, technical charts, price analyses of coins and press releases. When he is not exploring and covering the latest topics in crypto, you can find Stefan playing basketball, tennis or cycling.
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