AVAX, the cryptocurrency, faced a 30% price drop in the past month, marking a significant downturn. This decline is attributed to decreased user engagement on the Avalanche C-Chain network, as per CoinMarketCap data.
A thorough on-chain analysis of the proof-of-stake blockchain network identified the diminished value of AVAX, directly linked to a drop in user activity on its crucial C-Chain. Despite Avalanche consisting of P, X, and C-Chains, the C-Chain holds prominence for enabling users to create and engage with decentralized applications (dApps).
The Artemis data further underscores the decline in demand for Avalanche C-Chain. Unique wallet addresses conducting on-chain transactions witnessed a sharp 45% decrease in the last 30 days.
The reduced user base has led to a substantial decline in transaction counts, plummeting by 95%, with only 266,820 transactions recorded during the period. Unsurprisingly, low user activity correlates with a sharp drop in transaction fees on the C-Chain, down by 97% to $39,000.
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Comparatively, on December 22, 2023, transaction fees totaled $1.25 million, highlighting the stark contrast in user engagement. The revenue generated from these fees mirrored a similar decline, contracting by over 95% in the last month.
Shifting focus to the decentralized finance (DeFi) sector, the decreased user count has contributed to a 16% dip in the total value locked (TVL). Additionally, transactions through decentralized exchanges (DEXes) on the blockchain network saw a substantial 53% decrease in the past month.
Disclaimer: The information presented in this article is for informational purposes only and should not be considered as financial advice. Cryptocurrency markets are highly volatile and can be subject to rapid and unpredictable changes. Readers are encouraged to conduct their own research and seek professional financial advice before making any investment decisions. The authors and publishers of this article are not responsible for any financial losses or damages that may result from the use of the information provided herein. All readers are urged to exercise caution and diligence when engaging in cryptocurrency investments.
