Avalanche Monthly Analysis – February 2022

Avalanche (AVAX), like all top crypto assets, had a generally better run in February than January. The currently tenth-ranked crypto in market capital by CoinMarketCap recouped January losses in the first half of last month before seeing a decline in the second. While March has proved to be even better so far, AVAX is yet to retest its December highs.

Here’s a detailed look at how Avalanche fared in February:

Market metrics

Market capital

Starting the year off with a $26.63 billion market cap, the Avalanche network saw a consistent decline in circulating market capital in sync with its price, to reach its worst day this year, on 23^rd January. Avalanche fell below the $15 billion mark to $14.61 billion in market cap on that day, the lowest since the beginning of November.

AVAX Circulating Market Cap YTD chart

From 24^th January, Avalanche embarked on a mini-rally, reaching $17.15 billion (February’s lowest) on 1^st February. The market cap grew by a further 36% to peak at $23.4 billion on 17^th February, which was, however, still lower than January’s peak of $27.87 billion.

Blockchain and Network metrics

Avalanche C-Chain transactions

Avalanche’s default smart contract blockchain has experienced a general uptrend in the number of daily transactions. After the chain started the year with 515,658 daily transactions, the lowest number of transactions all year, it grew and blew greater than twofold to reach 1,100,404 total transactions on 27^th January. This transaction count, as of writing, is an all-time high.

Daily Transactions chart

February was a better performing month in this metric. The number of transactions stayed above 800,000 all month. Comparatively, the numbers generally dwelled below this level in the previous month. The least number of transactions last month was seen on 18^th February, when 817,097 transactions were recorded, and the monthly peak of 1,081,911 was achieved on 8^th February.

Avalanche C-Chain Unique Addresses

The number of unique on-chain addresses has seen a consistent rise this year. That said, the growth seen across January was greater than that seen in the second month.

Unique Addresses chart

In fact, January registered a higher daily apex in new unique addresses than February did. On 17^th January, the number of new daily addresses reached a monthly high of 17,146, and February saw a maximum daily increase of 15,873 on the 8^th.

Overall, the Avalanche numbers grew from 1,462,276 on 1^st January to reach 1,829,210 on 31^st January, an increase of 366,934. This number continued increasing from 1,839,873 addresses on 1^st February to 2,122,663 on the last day of February.

Average Gas Price (AVAX)

Gas prices have always been a matter of conversation within the space. Particularly for Avalanche, having some of the most competitive prices has positioned it well to be part of the chains chipping off Ethereum’s market share, more so in DeFi.

Avalanche has historically charted a step-like decline in gas prices since its launch in September 2020. The first step lasted until March 2021, the second one went on till August, and the chain’s gas prices are currently in the lowest (third step) historical levels yet.

For context, the highest average gas fees this year was recorded on 31^st January – 97.4747 nAVAX, an equivalent of $0.00000664 at the time. In comparison, gas fees predominantly stayed above $450 nAVAX (reaching as high as 849.36 nAVAX) during the first ‘step.’ The least amount in gas prices in January – 42.424 nAVAX, was recorded on the 01^st.

Average Gas Price chart

The average gas prices crossed above 80 nAVAX only twice all month, on 10^th and 19^th February. The latter date saw the peak monthly gas prices, reaching 93.42 nAVAX, while the lowest figure– 46.07 nAVAX – was observed on the 23^rd.

Avalanche C-Chain Network Utilization

February’s network utilization chart depicts a picture of increasing use of gas relative to the maximum gas limit. Across the whole year, Avalanche’s c-chain has hardly operated at half full network capacity. However, the network utilization has been rising steadily towards the 50% mark.

Network Utilization chart

Growing by a massive 17% from January’s monthly low of 21.62%, the network utilization reached a peak of 38.68% on 31^st January. Last month, utilization was lowest on the 5^th February, 33.34%, and highest on 10^th February, 44.94%.

DeFi performance

Market Share and TVL

The Ava Labs-produced blockchain has risen to become one of the largest DeFi ecosystems, as evidenced by the overall growth in market share since the start of the year. However, the total value locked (TVL) on the blockchain has pretty much been fluctuating since the turn of the year.

Avalanche has been battling for DeFi market share ranking with fellow proof-of-stake consensus blockchain Fantom. Its market share fell from 4.89% at the start of the year to 4.63% on 1^st February, losing fourth-place ranking in the process.

Since then, Avalanche regained over Fantom early in February but then conceded again. By the end of February, the former had a 5.27% market share compared to the latter’s 5.68% share.

Total Value Locked chart

For most of February, Avalanche sat fourth among top chains in TVL before losing the spot to Fantom towards the end of the month. On 27^th February, Fantom flipped Avalanche, with $11.28 billion against $10.55 billion. On the last day of February, Avalanche’s TVL had dipped to $10.33 billion, ranking behind Fantom. The chain has since reclaimed fourth place in March with a TVL of 11.14 billion as of writing.

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