What is Avalanche?

Avalanche is a platform for creating custom blockchain networks and decentralized applications (dApps). Created by Ava Labs, the Avalanche crypto platform is one of many projects seeking to unseat Ethereum as the blockchain ecosystem's most widely utilized smart contract platform.

AVAX:

$AVAX is Avalanche’s native token which is used to pay transaction processing fees, secure the network, and act as a basic unit of account among blockchains in the Avalanche chain.

Dashboard Introduction & Methodology

In this dashboard and on the occasion of recent hype in $AVAX price especially during January 2023 (and also the movement of BTC holders to the Avalanche chain), I am going to analyze data on the Avalanche network Since the start of the year 2023 (From 2023-01-01 till today) and to see what can be the possible reasons behind $AVAX price raise and also what can be the fuel for the growth of Avalanche raise and movement of BTC holders to this chain.

So, In this dashboard, I am going to analyze:

• $AVAX Price Movement During January 2023

• Overall Avalanche Network Activity During January 2023

• Bridged Bitcoin (BTC.b) Activity Within Avalanche Network

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Methodology:

The main tables that I am going to use for this bounty are Flipside’s avalanche.core.fact_transactions, avalanche.core.fact_event_logs, avalanche.core.ez_avax_transfers & avalanche.core.fact_token_transfers. Also, I have extracted the value of the $AVAX token using ethereum.core.fact_hourly_token_prices table (filtering the symbol column to WAVAX token). For calculating the $USD volume of transactions on the Avalanche chain, I have used the amount_usd column in

avalanche.core.ez_avax_transfers table but since the volume of transactions in avalanche.core.fact_token_transfers are unadjusted and also there is not any price table in Avalanche core tables, I have tried to calculate the daily $USD value of tokens via their swapped amount with stablecoins such as USDC, USDT & DAI using the avalanche.sushi.ez_swaps table and also extracted the decimals of each token from the avalanche.core.dim_contracts in order to adjust the raw_amount of transferred tokens.

Also, I have extracted the Avalanche’s wallet addresses that belong to the Centralized Exchanges using avalanche.core.dim_labels and also crosschain.core.address_labels by filtering the label_type column to ‘cex’. when the $AVAX transfer is being done to CEXs, this means users are probably going to sell their $AVAX and when the transfer is done out of CEXs, this means users have bought $AVAX and are transferring it out of CEXs.

For calculating the swap activity of the $AVAX token, I have extracted the tx_hash of swaps via avalanche.core.fact_event_logs table then using the same table, I have distinguished swaps from & to $AVAX token. when origin_from_address is equal to event_inputs:from means that the swap transaction is FROM $AVAX (SELL) and when origin_from_address is equal to event_input_to means that the swap transaction is TO $AVAX (BUY). Considering that in this part we have to filter event_name to ‘Transfer’.

But first of all, I am going to point out to some important news about Avalanche network during the recent months:

Avalanche’s Recent Important News:

Nov. 22, 2022: Rust VM SDK: Build Custom Virtual Machines on Avalanche using Rust: Rust SDK is the second SDK for building Avalanche Virtual Machines As an alternative to using Golang, users can instead use Rust to launch their own blockchain on an Avalanche Subnet. Read More

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Dec. 2, 2022: Alibaba Cloud Expands to Support Validators and Infrastructure on Avalanche Public Blockchain: Alibaba Cloud, the largest cloud service provider in Asia Pacific, has expanded their line of infrastructure technology and intelligence tools to the Avalanche public blockchain, enabling users to launch validator nodes through the service and access computing, storage, and distribution resources through Alibaba Cloud’s suite of products in Asia. Read More …

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Dec. 13, 2022: Ava Labs has announced the release of a mobile version of its Core wallet: Ava Labs, the development company behind the Avalanche blockchain, announced the release of Core Mobile, a mobile version of its non-custodial multichain wallet. Core Mobile aims to connect DeFi, NFT, and gaming ecosystems across the Avalanche, Bitcoin, and Ethereum networks, as well as other EVM-compatible blockchains. Read More …

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Jan. 11, 2023: Ava Labs and Amazon Web Service Bring Scalable Blockchain Solutions to Enterprises and Governments: Ava Labs and Amazon Web Services (AWS) have joined forces to accelerate enterprise, institutional, and government adoption of blockchain. AWS supports Avalanche’s infrastructure and dApp ecosystem, including one-click node deployment, through the AWS Marketplace. Critically, Avalanche node operators can run in AWS GovCloud for FedRAMP compliance use cases — a vital capability and a pre-requisite for enterprises and governments. Read More …

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Jan. 31, 2023: The first institutional Subnet is here! Intain, a structured finance platform that facilitates the administration of $5.5B in assets, is launching IntainMARKETS, an on-chain marketplace for tokenized asset-backed securities. Source

On the left chart, we can see the daily price change of $AVAX & $BTC over time since the start of the year 2023.

As we see, both of them (and also the whole cryptocurrency market) have experienced significant growth in their price during this month but the growth rate of $AVAX is significantly more than BTC. So, one of the effective reasons on $AVAX price rise can be the good situation and also the growth of BTC & cryptocurrency market.

However, AVAX seems to be reaping the benefits of recent partnerships its network sealed with Amazon and finance platform Intain. The collaboration between Ava Lab and AWS looks to further democratize access to blockchain technology in order to facilitate adoption by businesses, institutions, and governments around the world. On 11th January (Partnership Announcement Day), The price of Avalanche (AVAX) has surged more than 12%, outperforming the rest of the crypto market. 

So, we can say that the price rise (on Jan. 11) was not a bull trap since we have seen continuous positive price movements over time.

$AVAX Price Analysis

AVAX witnessed a meteoric start to 2023, gaining 100% in January, and traders are curious about whether the rally will extend throughout the future. AVAX’s year-to-date gains for 2023 have outpaced those of Bitcoin Recent reasons for AVAX’s rally can be attributed to an Amazon partnership announcement on Jan. 11. While AVAX price has benefited from the news, some analysts also predicted that the move could have been a bull trap.

Anyway, AVAX has undeniably responded positively to these developments as it continues to paint its charts in green, recording massive upticks in its value over the last few weeks.

According to the above charts, since start of the year 2023, we can see the situation of $AVAX in DEXs is better than CEXs. As we see, in majority of days, the net volume of $AVAX swapping activity within DEXs is positive which means that there is more buy pressure of this token on swap programs especially on 11th January (the Amazon & Avalanche Partnership Annoucement day).

On the other hand, the $AVAX sell pressure on CEXs has increased significantly every time the $AVAX price has experienced high spikes of growth and maybe traders wanted to save their profit after that price growth. But anyway, in majority of days, the $AVAX transfers to CEXs is more than transfers from CEXs.

Overall Analysis of Avalanche Network

In this part, since the bounty question asked us about the $AVAX price movement in January 2023, I am going to separate days into 2 parts: 1- Before Avalanche & Amazon Partnership Announcement (on 11th January) and 2- After That.

The goal behind this classification is to better understand the possible positive impact of this announcement (as the most important new over the Avalanche during recent months) on Avalanche’s chain activity.

From the above charts, it's clearly obvious that the activity on the Avalanche network has increased dramatically after the announcement of its partnership with Amazon Web Service. The activity growth is clearly visible, especially in the number of transactions on this chain. The number of Avalanche transactions has increased by 145% on the day of the announcement (compared to the previous day) which shows the significant positive impact of this announcement on the Avalanche network. Also, there are more active & new users who are performing activity on the Avalanche network after the announcement which is another good impact of this announcement. Another interesting thing is the significant positive impact of the announcement on the number of newly deployed contracts on Avalanche which has been started since the announcement date (11th January).

After the AWS news, AVAX price was not the only metric seeing a quick rise. On Jan. 14, Avalanche network hit a high of 1956 AVAX fees received signaling that positive price appreciation helped boost the fees that the network received.

On the left chart, we can clearly see the positive impact of the partnership announcement on the Avalanche network with the comparison of the average daily number of transactions and Avalanche users before & after the announcement.

So, we can say This impressive rally that AVAX has enjoyed seems to have rubbed off in other aspects of its ecosystem, as evidenced by the 85% increase in the average daily transactions its native chain processes.

Similar to the transactions activity on Avalanche, the volume of transactions has also increased significantly after the partnership annoucement day.

Also, the average volume of transactions on this chain has increased after annoucement day meaning that users are performing more-worthy transactions as time goes on.

On the left charts, we can see the %share of popular Avalanche network’s programs over time. As we see, TraderJoe has by far the highest share among other programs and programs such as AAVE are on the next ranks of this chart.

While Aave and Trader Joe are leading the Avalanche blockchain, when looking at DEX activity on other blockchains, they witness far less trading volume. DEX volume directly correlates to the fees that a protocol receives.

Bridged Bitcoin (BTC.b) Analysis on Avalanche

According to the published Coindesk article and Dune analytics, The number of bitcoin (BTC) bridged or ported from the Bitcoin blockchain to the Avalanche smart contract blockchain has surpassed the tally of coins held in the Lightning Network, a second-layer solution for Bitcoin's scalability problems. The flippening has brought cheer to the Avalanche community and developers behind the project.

P.S: Avalanche added support for BTC in its cross-chain bridge in June 2022, opening the doors for bitcoin holders to transfer coins to Avalanche and access the Avalanche-based decentralized finance (DeFi) ecosystem.

On the above-left chart, we can see the daily flow of bridged bitcoin (BTC.b) within the Avalanche network over time. As we see, the activity of this token within Avalanche network is increasing significantly as time goes on especially during February 2023.

In the above right chart, we can see there are increasing number of Avalanche users who have used BTC.b token in this chain for the first timee over time with the highest spike during December and November 2022.

On the left chart, we can see the comparison of average daily number and volume of BTC.b transactions on Avalanche during the year 2022 vs 2023 and the dominance of 2023 is clearly visible.

On these charts, we can see the top popular and also FIRST destinations of BTC.b transactions on Avalanche network. As we see, TraderJoe is by far the most popular destination of this token in Avalanche followed by Paraswap and Platypus Finance on the next ranks with a big difference.

So, the main destination of BTC.b transactions on Avalanche network is swap prorgram which means BTC.b users tend to swap their token in Avalanche network more than any other activity via this token.

On the left chart from the Coinglass website, we can see the Open Interest of $AVAX over time.

Open Interest spiked upward on 28 January. Since then, it has made a series of lows. During the same period, AVAX reached $21.6 and pushed higher to reach $22.75. By this time, the OI had already weakened, not to mention the bearish divergence the RSI made with the price.

The funding rate remained positive, which suggested market participants were bullishly positioned and had not yet flipped strongly. Overall, buyers looking to hold AVAX for a few weeks before selling can wait for a bullish reaction across the market before buying, and cut their losses to a drop below $15.7.

Summary & Conclusion

According to the above analysis, Positive news around Avalanche network and its native token, $AVAX seems to be the most effective factor for the $AVAX price rally during January 2023.

We can say the most important announcement that has resulted in the highest positive impact on Avalanche network activity and also the growth of $AVAX price was Avalanche Partnership with Amazon Web Service which has been published on January 11 and we have seen significant increasing activity over Avalanche transactions, users, deployed contracts, paid fee for transactions and also transactions $volume after this event. As proof of the positive impact of this announcement. we have seen the highest growth ratio of Avalanche transactions (compared to the previous day) on 11th January (announcement day).

While Avalanche is currently witnessing immense growth from the AWS announcement, the blockchain is still small compared to competitors. The goal of the AWS partnership was to help increase network activity by reducing barriers to entry. Reaching the goal may increase Avalanche adoption but other ecosystems seem to be out to a large and early lead. However, this satisfying Avalanche’s development has resulted in the increasing number of bitcoin (BTC) bridged or ported from the Bitcoin blockchain to the Avalanche to the extent that the daily flow of BTC.b within the Avalanche network is significantly more than its daily activity during the past year.

Avalanche swap programs and on the top of them, Trader Joe was the most popular destination of all Avalanche network transactions and also bridged Bitcoin into Avalanche network.

$AVAX holders have also increased by 5% during January 2023 compared to the days before the year 2023 and also the average held amount of $AVAX by a wallet increased during recent weeks which shows the increasing trust of crypto users and traders in Avalanche and its $AVAX token.

The Buy-pressure of $AVAX token within Decentralized Exchanges in this network was more than Sell-Pressure and this can be another impressive impact on the $AVAX price rally but this token’s situation on Centralized Exchanges was not very good since traders tend to save their earned profit from the growth of $AVAX token during January.

The $value of BTC & and also the majority of cryptocurrencies has increased significantly since the start of the year 2023 and this can be another reason behind that 100% price raise of $AVAX during recent weeks.

Totally, we can say that if Avalanche, as it has participated in many big projects and cooperated with well-known companies (such as Alibaba, Amazon & …), continues to progress and follow the Road Map in the future, we can see a very bright future for this project and its $AVAX token and as a result, there would be more non-Avalanche-native tokens holders (such as BTC.b) bridging their asset into Avalanche chain in order to take advantage of this network’s facilities.

**Discord: Ali3N#8546 Twitter: Alik_110 Email: Alik110.72@Gmail.com Check out My Other Dashboards at: **

Other External Sources:

https://ambcrypto.com/avax-remains-bullish-but-long-term-investors-should-wait-for-this-level

The number of $AVAX holders on today is almost 130k more than number of holders before January 2023 which shows almost 5% growth which is satisfying.

Moreover, the average held $AVAX by a wallet on today is more than average held $AVAX by wallet before January 2023 which is another positive point.

Another not so important but promising factor for AVAX token

What currencies are there in the wallets of Messari employees?!

Every year, the famous Messari company introduces the portfolio of its employees in the previous year in its end-of-year report and also specifies their current portfolio. Here are the most cryptocurrencies that these 24 Messari employees had in order:

1- Ethereum (ETH): Held By 23 People

2- Bitcoin (BTC): Held By 14 People

3- Solana (SOL): Held By 7 People

4- AVAX, MATIC, USDC & RNDR: Held By 6 People

Source

On the left chart, we can see the Minted & Burnt BTC.b on Avalanche over time.

As we see, as time goes on and especially during the recent weeks, there is more volume of minted BTC.b on Avalanche than the burnt volume which is the increasing popularity of this token on Avalanche.