By Carol
Ethereum's high transaction fees (often exceeding $30 per transaction) have earned it the nickname "Noble Chain." This not only limits its ecosystem growth but also creates opportunities for emerging blockchains. Earlier this year, Cardano reported a 631.73% year-over-year increase in daily active addresses, while Solana's DeFi Total Value Locked (TVL) surged 1,738% in two months. Now, Avalanche (AVAX) is stealing the spotlight.
According to CoinGecko, AVAX has risen over 70% in the past 30 days, reaching ~$111 with a market cap of **$24.8B** (ranked #11). What’s driving Avalanche’s rapid growth? Let’s analyze its on-chain fundamentals:
Key Findings
- Price & Transaction Growth: AVAX surged 228.55% in 3 months, while daily transactions jumped 414.12%, reflecting strong demand-side growth.
- Transaction Fees: Average fee per transaction is $0.66**, peaking at **$3.0 (+757% monthly increase).
- Active Addresses: Daily active addresses skyrocketed 520.96%, surpassing 100K on November 22.
- Staking: AVAX staking ranks 4th ($32.1B TVL) with a 61.26% staking rate and 9.38% annual yield.
- DeFi Boom: TVL grew 354.64% to $10.03B, with native protocols outperforming cross-chain rivals.
Price Surge & Transaction Volume: Demand-Driven Growth
Over the past 3 months:
- AVAX price: $39.62 → $130.17 (+228.55%).
- Daily transactions: 120.4K → 619K (+414.12%).
👉 Why Avalanche’s low fees attract users
Key Insight: Demand growth outpaced price appreciation, indicating organic adoption. Post-late October, both metrics surged in sync, signaling accelerated ecosystem maturity.
Transaction Fees: Balancing Cost & Demand
- Total fees (3 months): $15.44M (~185.8K/day peak).
- Avg. fee/tx: $0.66 (November peak: **$3.0**, +757% monthly).
Blockchain Trilemma: Rising fees alongside demand highlight trade-offs between scalability, security, and decentralization.
User Growth: Active Addresses Cross 100K
- Daily active addresses: 16.7K → 100K (+520.96%).
- November alone: +154.88%.
Implication: Growth stems from new users, not repeat transactions—a sign of sustainable expansion.
Staking: High TVL but Slower Address Growth
- Staking TVL: $32.1B (ranked #4).
- Staking rate: 61.26% (higher than DOT, NEAR).
- Staking addresses: +15.54% (vs. 520.96% for active addresses).
Takeaway: Staking lags behind transactional activity, suggesting untapped potential.
DeFi Ecosystem: Native Protocols Lead
- TVL Growth: $2.2B → $10.03B (+354.64%).
Top Protocols:
- AAVE, Trader Joe, Benqi, Curve (all >$1B TVL).
- Native protocols outpaced cross-chain rivals (+14.98% vs. +1.52% weekly growth).
👉 Explore Avalanche’s top DeFi projects
Market Insight: Low market-cap/TVL ratios (e.g., Trader Joe: <0.1) suggest undervaluation of native projects.
FAQ Section
Q: Why is Avalanche gaining popularity?
A: Low fees (~$0.66/tx), scalability, and a booming DeFi ecosystem (+354.64% TVL in 3 months).
Q: How does AVAX staking compare to competitors?
A: 61.26% staking rate (4th highest TVL) but lower yield (9.38%) vs. SOL or ADA.
Q: Are Avalanche’s DeFi protocols undervalued?
A: Yes—many native projects have market-cap/TVL ratios <1 (e.g., Benqi: ~0.1).
Q: What’s driving fee increases?
A: Rising demand (+757% in November) and blockchain scalability limits.
Conclusion
Avalanche’s rapid growth is fueled by low-cost transactions, exploding DeFi adoption, and expanding user base. With staking and native protocols still maturing, its ecosystem has room to scale further.