Avalanche’s native token, AVAX, has returned FOMO-inducing (fear of missing out) gains since the smart contract platform launched its mainnet less than two years ago.
Avalanche’s vibrant decentralized application (DApp) ecosystem and big-name collaborations helped AVAX surge from below $ 4 at the start of 2021 to above $ 100 by the end of the year.
As of 21 February 2022, AVAX has been among the top 10 cryptocurrencies by market capitalization, according to CoinMarketCap.
What is the AVAX coin price prediction for 2022 and beyond? In this article, we will look at why the platform is seen as a challenger to smart contract platform leader Ethereum’s top spot.
Avalanche outlook: World’s fastest blockchain network?
In the blockchain world, scalability and speed are among the main technical hurdles for decentralized finance (DeFi) projects to go mainstream. Smart contract platforms like Avalanche (AVAX) and Solana (SOL) have been chipping away market share from frontrunner Ethereum (ETH) by offering users lower gas fees and faster transactions.
According to its website, Avalanche claims to be the fastest smart contracts platform as measured by time-to-finality. Finality is the time taken by a blockchain network to validate a transaction and guarantee its execution.
Proof-of-work chains Bitcoin (BTC) and Ethereum (ETH) (soon migrating to a proof-of-stake consensus) take 60 minutes and 6 minutes, respectively, to achieve transactional finality. Avalanche, which uses the proof-of-stake consensus, achieves this in less than two seconds, according to its website.
Avalanche said its unique consensus engine allows it to achieve fast finality without compromising decentralization. On Avalanche, each node polls a small randomly selected set of neighboring nodes to validate transactions and arrive at consensus. The network also achieves transactional throughput of over 4,500 transaction per second (tps), compared to Ethereum’s 14 tps, via its three built-in blockchains: Exchange Chain (X-Chain), Platform Chain (P-Chain) and Contract Chain (C -Chain).
The X-Chain is a decentralized platform for trading digital smart assets. The P-Chain coordinates with network validators and enables the creation of new subnets. The C-Chain facilitates the creation of smart contracts.
This brings us to another feature of Avalanche: subnets. One of the network’s core features is the ability to create new blockchains. Each blockchain on Avalanche is validated by one subnet. Subnets allow the creation of customisable chains for different use cases where network validators can choose to validate a particular chain within a given subnet.
“If a validator does not care about the blockchains in a given subnet, it will simply not join that subnet. This reduces network traffic, as well as the computational resources required of validators, ”said Avalanche on its whitepaper.
Avalanche is also among new layer 1 networks that are compatible with Ethereum Virtual Machine (EVM), which means that Ethereum developers can deploy existing DApps to Avalanche.
What is Avalanche (AVAX) coin?
AVAX is the native coin on the Avalanche platform. It’s used for staking, governance and paying transaction fees on the network. AVAX is also required by users to create a new subnet and join a subnet.
Avalanche requires a validator to stake a minimum 2,000 AVAX for at least two weeks. Delegators who want to participate in staking can choose to stake with an existing validator by committing a minimum of 25 AVAX.
According to its whitepaper, the AVAX token has a capped supply of 720 million coins. All processing fees on Avalanche are burned to increase the scarcity of AVAX. Avalanche said that while AVAX is capped, the rate at which the coin reaches its maximum capacity is subject to governance.
Currently, the circulating supply of AVAX stands at over 245.3 million, while its current total supply exceeds 395 million, data from CoinMarketCap showed.
AVAX news: Corporate collaborations
Avalanche has attracted global corporations. Payments giant Mastercard and consulting company Deloitte have agreed partnership deals with its Ava Labs research team.
In November 2021, Deloitte signed a deal with Ava Labs to develop a new disaster recovery platform that uses the Avalanche blockchain to help governments get federal emergency funding.
Avalanche said the Close As You Go (CAYG) platform will provide quick processing and authentication of disaster reimbursement applications to the Federal Emergency Management Agency (FEMA), minimizing fraud, waste and abuse.
Later in December 2021, Ava Labs was selected by Mastercard to join its Mastercard Start Path Crypto, a scheme dedicated to explore new blockchain technology development opportunities.
“Whether it’s enhancing financial freedom or a new value-added service using stablecoins, we believe our new cohorts of Start Path crypto and digital assets companies combined with Mastercard’s expertise in the space will accelerate access to new ways to pay and prioritize choice for consumers and businesses, ”said Jess Turner, executive vice president of New Digital Infrastructure & Fintech at Mastercard.
Avalanche is also active in the NFT space. Official Major League Baseball (MLB) card manufacturer Topps is partnering with the network to develop an NFT marketplace to sell official MLB NFTs. The Topps NFT marketplace on Avalanche also sells NFTs from Germany’s Bundesliga.
AVAX coin analysis: ‘Healthy’ volatility
According to the AVAX coin price chart, it was trading at $ 78.74 on 21 February. AVAX coin was the tenth biggest cryptocurrency, with a market capitalization of about $ 19.5bn, according to CoinMarketCap. The market capitalization of bitcoin and ethereum stood at over $ 713bn and $ 312bn, respectively.
In the past year, AVAX token price has surged over 107% from about $ 36 on 22 February 2021 to over $ 75 on 21 February 2022.
The coin hit a 52-week low of $ 9.34 on 22 June 202 – not long after China banned crypto transactions and mining.
The rebound from the crash was strong. AVAX / USD hit an all-time high of $ 146.22 on 21 November 2021.
In 2022, the cryptocurrency market has been facing bearish undercurrents with market participants growing increasingly wary of a potential “crypto winter”, similar to the one seen after bitcoin hit a then all-time high of nearly $ 20,000 in December 2017.
After seeing a brief jump in prices in early February 2022, bitcoin and ether have failed to break their resistance levels and have started to fall. Concerns of interest rate tapering by the US Federal Reserve have forced Institutional investors to rejig their investment strategy.
In the past week, AVAX has fallen nearly 7%. In comparison, bitcoin and ether have each fallen by over 11%. In 2022, AVAX has lost over 33% of its value, as of 21 February – bitcoin is down 21% and ether by over 30%.
However, Sirer remains “super bullish” on the blockchain industry despite bearish sentiment in 2022.
“In the short-term, fluctuations are fine, some shake out is fine. Supremely bullish markets are not all that healthy and they create a lot of froth and you can not tell true value from the meme coins because whatever you buy it goes up so people start buying stupid things that really have no reason to exist. I kind of like where we are and I am super bullish and super excited about where we are about to go to, ”he said.
AVAX price prediction: Will the price return to its all-time high?
According to a short-term AVAX price prediction from Coin Codex (as of 21 February), the coin could rise over 7.5% to $ 69.6 by 26 February. CoinCodex added that technical indicators showed that current (21 February) sentiment for AVAX as “bearish”, while the fear and greed index indicated “extreme fear”.
“Based on our Avalanche forecast, it’s now a bad time to buy Avalanche,” said CoinCodex.
Meanwhile, the Avalanche forecast from Wallet Investor (as of 21 February) said it could be an “awesome long-term investment”. The algorithm-based forecaster expected the price to reach over $ 184 by February 2023, $ 391 by February 2025 and $ 594 by February 2027.
According to Price Prediction’s AVAX / USD forecast, the coin could hit an average price of $ 109.07 in 2022, $ 321.84 in 2025 and $ 1,909.51 in 2030.
Avalanche crypto price prediction from Digital Coin expected the token to trade at $ 102.84 in 2022, $ 161 in 2025 and over $ 359 in 2030.
When looking for avalanche future price estimates, bear in mind that analysts’ and algorithm-based predictions can be wrong. Projections are based on fundamental and technical studies of the AVAX past performance, which offers no guarantee of future results.
It is essential to do your own research. Remember that your decision to trade depends on your attitude to risk, your expertise in the market, and your investment portfolio spread. You should never invest money that you can not afford to lose.
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