Overview

The price of the whole crypto market has sank in recent days due to several bad news for crypto and the continuation of a bad trend in the entire cryptomarket. However, it seems that there is some reason why Avalanche has been one of the cryptos that people talked more about over the recent days.

The main impact news for crypto market movement were about FTX and Alameda Research that finally was declared as bankruptcy. As well, it has been that some FTX account hacker drained a lot of ETH and were swapping the tokens.

As well, Solana was one of the most collaterally affected chains due to was one of the main ecosystems of FTX. Consequently, its price dropped drastically as well during these past days.

But… what about Avalanche? Will follow similar behavior or will be the next Ethereum competitor and will be able to surpass Solana? Let’s see!

Methodology

For this reason, we are gonna explore now how has been the price evolution of Avalanche (AVAX) and we will compare it against other cryptocurrencies. As well, we will try to find some pattern that could be related to the movement of the price.

To do that, I have compared several metrics between AVAX and its competitors like BTC, ETH, MATIC, BNB. The metrics studied have been:

• Prices trends over the past month
• Daily changes over the past month
• Relationship between AVAX changes and cryptomarket changes
• Some causes for AVAX’s struggle.
• Study of any potential causes or any indicators that could help us predict whether/when it could recover?

Ethereum price vs others

As seen, from the beginning of July 2022, a total of 46 times the average market down more than 1%. Take into account that we have considered cryptomarket as average metrics of BTC, ETH, BNB, and MATIC tokens because in my opinion they are representative tokens. During these bad days when market down, the average changed in prices were -3.59%. However, in the case of AVAX price, the average percentage change during those days were -5.11. In fact, if we take into account how many times AVAX price decreased when cryptomarket falls more than 1% were 36. Then, in only 6 times when the cryptomarket goes down more than 1%, AVAX price stayed safe.

Finally, I have computed how many times AVAX prices outperformed the cryptomarket when it went down. From the 46 times, 16 days AVAX price outperformed cryptomarket, being 34.8% of times when AVAX price had a better performance than the whole cryptomarket.

To conclude this first approach, I have compared the evolution of AVAX price against the whole cryptomarket in order to see if it follows similar trends or at some points the AVAX price developed different sideways. In the first image, we can see the AVAX price changes over the past months in comparison to the other top crypto tokens such as BTC, ETH, BNB and MATIC. As it can be seen, when the BTC goes up or down, the other altcoins do the same but in a more pronounced manner. It seems that AVAX is one of the most volatile tokens, but the trend is similar to the rest.

In fact, if we take a look at the second image, we can see how there is a strong positive correlation between the AVAX price change and the average cryptomarket price in terms of daily changes. It can be clearly seen that when the percentage is negative, the aerage market change is negative as well. On the other hand, when the AVAX price change is positive the average whole cryptomarket goes up as well. In both cases, when the percentage is higher, the same occurs for the whole cryptomarket.

Indicator 1: transactions activity

The first possible indicator selected is the transaction activity on Avalanche ecosystem, representing the whole blockchain activity. When the price of an asset changes, it is the major of the times related to its main activity.

If we take a look at the first chart, it can be seen how the Avalanche transactions have been decreasing from July to October. However during October and first days of November, the activity jumped but now, the bad trend seems to continue. Something similar occurs with the active users. It was decreasing over time since July and did an spike on mid October. However, now the bad dynamic presists.

In terms of fees paid, it has been moving in a similar range since July 2022. However, it has been decreasing slowly and the dalily fees passed from 1.5k to around 1k. However, if we take a look at the average transaction fee, we can see how it has increased over time.

Indicator 2: transfer’s activity

The second possible indicator selected is the transfers. When the price of an asset change, it is commonly realted to transfers activity.

If we take a look at the first chart, it can be seen how the volume of AVAX in transfers has fluctuates a lot over the past days and weeks. If we take this trend and compare it against the AVAX price, we can see how they are positively correlated due to follows similar trends. From July to October, the amount of transfers were decreasing over time and the same did the AVAX price. However, during finals October and initials November the amount of transfers increased and the price of AVAX did the same.

Looking at the relationship between volume transferred and price movements, we can see a strong positive correlation, saying as that when the volume transferred is higher, the AVAX price seems to go up.

Key insights

• The difference between BTC price performance and AVAX price performance over the past months. It can be seen how the AVAX and BTC prices followed similar trends. However, it seems that when the BTC prices drops heavly, the drop of the AVAX price tend to be higher.
• A total of 46 times the average market down more than 1%. Take into account that we have considered cryptomarket as average metrics of BTC, ETH, BNB, and MATIC tokens because in my opinion they are representative tokens.
• During these bad days when market down, the average changed in prices were -3.59%. However, in the case of AVAX price, the average percentage change during those days were -5.11. In fact, if we take into account how many times AVAX price decreased when cryptomarket falls more than 1% were 36. Then, in only 6 times when the cryptomarket goes down more than 1%, AVAX price stayed safe.
• From the 46 times, 36 days AVAX price outperformed cryptomarket, being 34.8% of times when AVAX price had a better performance than the whole cryptomarket.
• AVAX price changes over the past months in comparison to the other top crypto tokens such as BTC, ETH, BNB and MATIC. As it can be seen, when the BTC goes up or down, the other altcoins do the same but in a more pronounced manner. It seems that AVAX is the most volatile one.
• There is a strong positive correlation between the AVAX price and the average cryptomarket price in terms of daily changes. It can be clearly seen that when the percentage is negative, the average market change is negative as well.
• The Avalanche transactions and the active users have been decreasing from July to October. However during October and first days of November, the activity jumped but now, the bad trend seems to continue.
• Even the number of transactions decreased and the total fees paid did the same as well, the average transaction fee has increased over time.
• The volume of AVAX in transfers has fluctuates a lot over the past days and weeks, and compare it against the AVAX price, shows a strong positive correlation due to follows the same trends.

As a result, here we can see the difference between BTC price performance and AVAX price performance since July 2022. It can be seen how the AVAX and BTC prices followed similar trends. However, it seems that when the BTC prices drops heavly, the drop of the AVAX price tend to be higher.

The second and third chart represents the daily change in price of AVAX price against BTC price. When BTC decreases the AVAX prices decreased in a higher % and on the other way around.