The AVAX native token, which powers the layer-1 blockchain Avalanche, is experiencing a significant downturn this weekend. The token has plummeted more than 10%, hitting its lowest level since December 2023. Within a span of just 24 hours, AVAX has tumbled from $27.87 to a six-month low of $24.92, as reported by CoinGecko. The sharp decline of 37% over the past month has left many investors baffled and concerned.
The crypto community is abuzz with discussions about AVAX’s current predicament. Many are questioning the reasons behind this steep decline. ‘Crypto Mechanic’ raised the alarm on June 22, pointing out that AVAX is one of the first high cap coins to break its yearly low. Meanwhile, ‘The Crypto Monk’ expressed skepticism about AVAX’s future, comparing it to “Cardano 2.0.”
Dr. Martin Hiesboeck, the head of research at Uphold, voiced his disbelief at AVAX’s downward spiral, likening it to an avalanche. He emphasized the exceptional growth momentum of Avalanche volumes compared to its counterparts. Despite the negative sentiment surrounding AVAX, major players like Konami are exploring opportunities on the Avalanche blockchain with the launch of an NFT platform called Resella.
A closer look at the market activity reveals interesting insights into AVAX’s decline. A whale, identified by ‘ZachXBT,’ has been moving substantial amounts of AVAX to centralized exchanges, totaling 1.96 million AVAX worth approximately $54.2 million. This significant transfer has caused AVAX’s market cap to plummet below $10 billion, relegating it to the fourteenth position on CoinGecko, below assets like Shiba Inu (SHIB) and Tron (TRX).
Despite the initial hype surrounding Avalanche this year, driven by real-world asset (RWA) tokenization narratives and strategic partnerships, AVAX has struggled to maintain its momentum. While it reached a high of $60 during the mid-March market rally, it is currently down by a staggering 83% from its all-time high of $145 in November 2021. The broader crypto market correction has also taken its toll, with total capitalization falling by 15% from its 2024 peak and 20% from its 2021 high.
As the crypto markets continue to adjust, altcoins like Cardano (ADA), Chainlink (LINK), Near Protocol (NEAR), Polygon (MATIC), and Fetch.ai (FET) are experiencing significant losses. AVAX’s plight serves as a cautionary tale for investors, highlighting the volatility and risks associated with the cryptocurrency space. The future trajectory of Avalanche and its native token remains uncertain amidst the ongoing market turbulence.
