Comprehensive Analysis of Avalanche Protocol and AVAX Price Trends

The Avalanche protocol has recently seen a decrease in daily active users, contrasting with a surge in the deployment of unique contracts. Positioned as a high-speed competitor to Ethereum, Avalanche targets surpassing Ethereum in smart contract applications by providing enhanced throughput capabilities without compromising on scalability. The protocol is structured into three chains - X-chains, C-Chains, and P-chains, each serving distinct functions.

A strategic partnership between Elixir Games and AVA Labs has been unveiled, signifying a deepening collaboration within the Avalanche protocol ecosystem. Notably, platforms such as Benqi and Yield Yak within the Avalanche network have reported a significant increase in revenue and fee collection.

User Activity Decline and TVL Status

Avalanche strategically addresses the blockchain trilemma through its triad of native chains, optimizing task allocation among them to heighten throughput while upholding decentralization.

In the recent week, the Avalanche protocol recorded 20,651,061 addresses and 7,336,449 transactions. Despite the uptick in unique contracts, active addresses dwindled from 205,297 to 95,788 in the preceding three months, with both daily and monthly transaction counts experiencing marginal declines.

While the Total Value Locked (TVL) in Avalanche remains stable amid declining active users, the number of unique contracts deployed has surged remarkably, nearing 260,000.

Notably, the TVL of Avalanche protocol has not reclaimed its 2023 levels, currently resting at $860 million from a previous high of $11.5 billion. Average revenue stands at $20k, with fees collected averaging $26k, signaling a potential bullish trend for the protocol.

Price Analysis and Market Cap Evaluation

With a market capitalization of $14.1 billion, Avalanche protocol is positioned as the 12th ranked platform on CoinMarketCap. The trading volume of AVAX has surged by over 66% in the last 24 hours, with approximately 54.9% of the total 442,544,533 AVAX tokens in circulation. AVAX is presently trading at around $36, showing a 1.74% gain in the intraday session.

The price movement of AVAX is currently consolidating, trading below the 50 and 100 Exponential Moving Averages (EMAs). Potential resistance lies near the $40 mark, while support is visible around $30. The Relative Strength Index (RSI) for AVAX hovers near 47, indicating a neutral market sentiment.

Final Remarks

In sum, the Avalanche protocol is witnessing a decline in active user engagement and transaction volumes, alongside a stable TVL. While the revenue and fee collection show a stagnant trend, the AVAX price is consolidating, with potential for upward movement driven by positive market dynamics and inflows within the ecosystem.