Avalanche (AVAX) exchange rate: how the price of the leading cryptocurrency in the RWA sector change
Emergence of the Avalanche platform (2020)
The Avalanche blockchain was launched in September 2020, the same time its native cryptocurrency, AVAX, was released. At that time, the bull run (bullish trend) in the crypto market was in full swing, especially in the decentralized finance (DeFi) segment, of which the Avalanche blockchain is a part.
The value of the AVAX cryptocurrency was quite significant at the very start: at the time of listing, the rate of this asset was $5.32. However, in November 2020, the price of AVAX had already dropped to $3.5.
Altseason and global correction (2021 — 2023)
In December 2020, the AVAX cryptocurrency rate began to rise sharply and reached $47.16 by February 2021. Up until May of the same year, the Avalanche rate fluctuated between $21 and $38 and then corrected until July, dropping to $9.6.
After this correction, a new, more significant wave of growth began: first, AVAX reached a new all-time high (ATH) at $74, and then updated it in November, reaching $146.22. The price of AVAX rose rapidly along with the cost of many other significant altcoins, as this was the so-called altseason.
There were no other significant factors for either correction or growth, despite ecosystem updates released during 2021, such as Apricot Phase One, which reduces commissions on the Avalanche C-Chain network by 50%. For the most part, the AVAX cryptocurrency rate in 2021 followed the general trend in the crypto market.
After reaching the last ATH, the value of AVAX began to fall rapidly: by January 2022, it had already dropped to $64.64. Then, the rate temporarily recovered to $96.72 by April, after which a more substantial wave of falls began, which accelerated in May.
In May 2022, one of the largest platforms on the DeFi market — Terra collapsed. First, Terra's UST stablecoin was decoupled from the dollar exchange rate, which was followed by the collapse of Terra's native cryptocurrency, LUNA.
Terra's collapse caused many other altcoins, especially AVAX, to fall hard. This happened because on the eve of Terra's collapse, in April 2022, the organizations behind the development of the DeFi platform, Terraform Labs and Luna Foundation, acquired the AVAX cryptocurrency. As a result, following Terra's collapse in May, AVAX's exchange rate dropped precipitously from $67.08 to $14.84.
New wave of growth and correction (2023 — 2024)
After the Terra crash and the crypto market stagnated, the AVAX cryptocurrency rate continued to correct until October 2023, when the price hit a two-year low of $9.11.
In October, the crypto market began to recover, and quotes of many cryptocurrencies resumed growth. By December, the AVAX rate rose to $48.06, and by March 2024, after a brief correction — to $58.49, updating the annual maximum. After that, the price of AVAX cryptocurrency started to correct again, and by October 2024, it decreased to $28.5. The last correction also concerned the entire cryptocurrency market. This occurred due to several large sales made by the German government and investors who had received large payments from previously bankrupt companies.
The future of AVAX
In 2023, the Avalanche team set its sights on one of the most promising and fastest-growing markets in the crypto industry — real-world assets or RWAs. According to CoinMarketCap, Avalanche is the leading platform in the RWA sector regarding capitalization, which exceeds $11.9 billion. But even more impressive is the list of Avalanche's partners, which includes major companies from the Web2 sphere. Let's list some of the partnerships and their goals:
- With OpenTrade, the Avalanche team has launched a real-world asset-backed USDC real-world asset (RWA) stablecoin investment product on its blockchain. The product is already being used by large banks such as Colombia's Neobank Littio, which provides Latin American clients with access to financial services via Avalanche's blockchain;
- ParaFi — tokenization of a fund using the Avalanche blockchain;
- Franklin Templeton is launching a tokenized Tokenized Money Market Fund called BENJI on the Avalanche network. Franklin Templeton is a significant investment firm with $720 billion in assets under management;
- Citibank is testing a private asset tokenization platform on the Avalanche blockchain. Citibank is one of the top 20 largest banks in the world and has more than $2.2 trillion in assets.
Having such significant partners says a lot about the prospects of the Avalanche blockchain. It also means that companies from the traditional finance (TradFi) market are increasingly interested in the RWA sector, particularly asset tokenization. As Avalanche is the leading platform in this segment, it is easy to assume that as new players in the Web2 crypto market emerge, its ecosystem will grow, which could positively impact the AVAX exchange rate in the future.