The crisis involving Terra’s stablecoin TerraUSD (UST) and the subsequent historic crash of Terra’s LUNA token has taken a heavy toll on general crypto sentiment. Following the crash, every cryptocurrency has suffered some losses.
On May 9, Avalanche (AVAX) fell below the important support level of £41.6, signifying a return of the downturn. AVAX was down 11% at press time, having lost nearly 30% of its value in a single day.
However, buyers have attempted to raise the price over the breakdown level.
Avalanche is among the industry’s fastest smart contract platforms in terms of time-to-finality. Avalanche boasts an ecosystem that is lightning-quick, low-cost, and environmentally friendly. Despite the market’s recent decline, AVAX has increased its value by more than 86% in the last month.
According to DeFiLama, AVAX’s TVL increased, continuing the trend. The platform had a 1.5% increase in value locked in only one day, crossing the £4.24 billion barrier. Given the ongoing sell-offs, this is an impressive figure.
Furthermore, daily transactions on the Avalanche network reached an all-time high following the launch of the Swimmer network subnet.
Ethereum users who didn’t want to lose money on the hefty gas fees seem to have found appeal in Avalanche. Different sorts of transactions demand different transaction fees, however they are all substantially less than ETH.
On the development front, AVAX had a decreased activity at the time of writing. However, it remained firm and held its place in the 10-30 range. Interestingly, development activity was higher at press time than when AVAX was trading at roughly £57.1. This can be interpreted as a vote of confidence in the ecosystem.
The DeFi growth in the Avalanche ecosystem was a major driver of AVAX’s last rally. AVAX had experienced a 9% correction as of press time, trading around £25.3. A further drop is possible, especially considering the growing panic in the crypto market as a result of recent price movements.