Avalanche Monthly Analysis – June 2022

Like other rival blockchain ecosystems, Avalanche sustained one of the most challenging monthly runs so far this year in May. The ecosystem's main token, AVAX, shed more than half its value in May, continuing an extended run of bearish action tracing to the first week of April. This gloomy state of affairs, at least from a bull's lens, extended into and throughout June as the network trended low in most metrics. Here's a breakdown:

Market Metrics

Price and Market capital

Avalanche's (AVAX) market capital is one stark instantiation of the persistent push to lower levels. The price (and derived circulating value) of the native token charted a descending curve in June, reaching their lowest numbers all year. Start of the year, the AVAX/USD pair changed hands at around $114.2o, translating to a market cap of $26.63 billion. There were several price declines in the five months leading to June, with the heaviest wiping away $10 billion from the market capital between May 5 and May 12.

A decent comeback in alt prices during the last week of May saw AVAX's circulating market capital reclaim $7.50 billion, heading into the first day of June. The recovery, however, didn't last as the token spent a 10-day period range trading between $24 and $25. Ahead of the second week of June, AVAX embarked on another downhill course with the token price bleeding further and reaching $16 by June 13. This period coincided with the lowest market capital of $4.16 billion on June 19. This figure had climbed back to $5.02 billion on the last day of the month.

Blockchain and Network Metrics

Avalanche c-chain transactions

The total number of transactions on the c-chain blockchain mostly remained below 300,000 for the better part of June. Avalanche recorded 238,856 daily transactions on June 1 and hardly five days later, this figure fell below 200,000.

The 181,698 transactions recorded on June 5 were the lowest for the month. The single significant spike was on June 13, when the total transactions count grew to 484,169. Towards the end of June, the figure associated with this metric was spotted hovering around 260,000.

Avalanche c-chain unique addresses

The number of unique addresses on a chain and their increase across periodic intervals is one of the defining elements of the network's activity. In Avalanche's case, the total distinct addresses interacting with the chain (excluding activity on subnets) continued accumulating in June.

The count of distinct addresses grew from 2,940,905 at the start of the month to 3,048,767 on June 30. This swell involving 107,862 addresses was nearly three times less than the cumulative unique addresses seen in the previous month. Avalanche's smart contract chain logged an additional 298,079 distinct addresses in May.

Average gas price (AVAX)

Unlike May, which saw average gas prices on Avalanche reach staggering high levels, June saw a fairly consistent run in this metric.

The average gas price predictably shot up to a monthly high of 95.84 nAVAX on June 13, coinciding with a surge in the number of transactions on the chain. For the majority of the remaining days, the gas price stayed below 50 nAVAX. Meanwhile, the 34.07 nAVAX gas price recorded on June 5 remained the lowest average figure on the network across the month.

Avalanche c-chain network utilization

Avalanche's c-chain network utilization – the average gas over the gas limit in percentage –plotted an almost steady line across the month, lying mostly below 20%. From a figure of 13.22% on June 1, the network utilization dipped to 9.68% on June 4. In the subsequent days, the network utilization grew to a monthly high of 24.2% on June 13, the first instance of a breach of the 20% mark since May 20.

DeFi Performance

Market share

Avalanche ranked fourth in market share for most days in June, only briefly dropping to fifth place before rising again. At the start of the month, the blockchain network had a market share of 3.68% and ranked fourth. It, however, gave away the position letting Solana above it on June 5, when it had a market share of 3.54%. Similar occurrences were witnessed on June 15 and 16, but Avalanche reasserted its position. As of June 30, Avalanche's market share had climbed to 3.70%.

Total Value Locked

Total value locked (TVL) represents the aggregate value of assets locked up in the Avalanche blockchain's decentralized finance protocols. The chain had a TVL of $4.11 billion on June 1, and as evidence of a falling pattern traced across the 30 days, this was the peak value in this metric in June. A breakdown followed that steadily drained about $1.5 billion in value locked, with the eventual figure being as low as $2.52 billion on June 19.

The figure also represented the lowest the TVL has been all year, given that such dismal numbers were last seen in September last year. Following this dip, Avalanche added more than $300 million in value locked over the next week. The chain closed off the month with $2.67 billion in this metric.

Protocol performance

Reflecting the overall performance in TVL, Avalanche's leading protocols posted massive declines in assetted value on the month. Of the blockchain's 206 protocols, only a handful registered positive growth relative to May. With a TVL of $1.09 billion on the last day of the month, lending platform AAVE remained the leading protocol boasting a dominance of 41.41% (an increase from 23.53% in May). However, its TVL was still down on the month.

AAVE V3, which arrived in March, was the biggest contribution to the total value, with $956.97 million. Evaluating the extremes in June, decentralized trading platform Trader Joe took the biggest hit of Avalanche's top ten protocols. It had a TVL of $180.57 million at writing, having shed over 40% across the month. DeFi yield optimizer Vector Finance, on the other hand, had the best performance among top protocols, growing 30% over the last month to reach a TVL of $96.02 million.

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