Blockchain technology is slowly revolutionizing almost all industries and even the internet itself. With the advancements in technology, investors are trying to find cryptocurrencies with the most potential to invest in.
A relatively new layer-one solution that has recently seen a significant increase in price and adoption is Avalanche (AVAX). It has resolved a major issue with cryptocurrencies today, enabling the smooth trading of digital assets. So why is AVAX going to explode in 2023? Let us see.
As Ethereum continues to struggle with high transaction costs and slower processing times, Avalanche has positioned itself as a dominant smart-contract platform. It aims to create a unified global financial market, where users will be able to trade digital currency in a frictionless way.
Is Avalanche Going To Explode This Year?
With its growing popularity, the price of AVAX will likely skyrocket tremendously in the coming years.
One of the unique selling points of Avalanche crypto is the ease of movement and trading between different asset classes. Financial security and speed of transactions are two of the key factors for the growth of economies in this era of uncertainties. Avalanche aims to provide a platform with faster speed, higher throughput orders, and lower fees.
It is basically an umbrella platform for launching DeFi applications, assets, trading, and other services. With its unique technology, Avalanche is certainly an integral part of the future of blockchain and Web 3.0. So let’s see what drives the price of AVAX to explode in 2023.
1. The Growth Of AVAX
AVAX is one of the fastest-growing cryptocurrencies in the market today. With a fast processing time and favourable growth trends for DeFi (decentralized finance) and NFT (non-fungible tokens) projects, AVAX has become an ideal choice for investors and developers across the globe. In addition, a significant rally over the past few months has pushed Avalanche to hit an all-time high of $146.22 on November 21, 2023.
Launched in September 2020, Avalanche was the brainchild of Emin Gun Sirer, a computer scientist and associate professor at Cornell University. The project certainly has had a few bumps along the way. But there has been a significant surge in its developer activity recently. Avalanche has also raised over $230 million from the sale of its native token, AVAX, and is here to stay for the long run.
2. Unique Features Of Avalanche
One of the unique features of the Avalanche blockchain platform is its ability to provide relatively fast solutions for smart contracts. Avalanche processes around 4,500 transactions per second. It is also gaining renown as an efficient network for application development for NFTs and DeFi.
Moreover, the AVAX token is backed by its own blockchain platform that promises faster speeds, lower fees, and high energy efficiency than its competitors like Ethereum. Also, its own consensus network, AVA, enables it to be a highly efficient platform for developing dApps (decentralized applications). The Avalanche network is also host to cryptocurrencies like Ethereum, Bitcoin, along with other collectibles. It also enables P2P lending on its platform.
Avalanche launched its own $220 million fund called Blizzard to support projects on its platform recently. As AVAX is listed on eminent cryptocurrency exchanges like Coinbase and Binance, it offers a safe and dependable platform for traders. It also allows lesser fees and a plethora of digital assets to pick and choose from, making AVAX a good buy now.
3. Avalanche’s Unique Tokenomic Design
The Avalanche protocol is known for its unique tokenomic structure that involves a transaction fee burning mechanism which helps reduce the circulating supply over time. The token has a hard-capped supply of 720 million AVAX. All fees on Avalanche are burned for the benefit of its community, reducing the token’s supply over time. This would eventually help in increasing the value of the token, pushing AVAX’s price higher. As of now, almost 163,000 AVAX have been burned, and the figure will increase rapidly as more users transact on the network.
4. Why Is Avalanche Going To Explode In 2023?: Expert Predictions
Wallet Investor:
“Based on our forecast, a long-term increase is expected; the price prognosis for 2027 is $811.74. With a 5-year investment, the revenue is expected to be around +1,015.79%.”
Tokeneo:
“Avalanche prices seem to be showing tremendous positive momentum for this year. The AVAX price might record around a 304% hike, making it the best option to invest.”
Don't Miss: Avalanche Price Predictions
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Factors That Drive AVAX To Explode In 2023
Thanks to its rapidly expanding DeFi ecosystem, Avalanche seems to be a good investment option for investors.
Several factors have boosted the price of the AVAX to skyrocket in the past few months. A new low-cost bridge to the Ethereum network and the launch of its new incentive program are just a few reasons. Let’s explore in detail.
1. The Release Of The Avalanche Bridge To Ethereum
One of the many reasons for the bullish rally of the AVAX token recently is the release of its new bridge, replacing the months-old Avalanche-Ethereum Bridge, or AEB. Avalanche Bridge or AB is supposedly five times cheaper than the previous one and acts as a growth engine for the project’s future. In addition, users of DeFi tools can also use the bridge to transfer their assets between the two ecosystems seamlessly.
The Avalanche Bridge is known as the next-generation cross-chain technology. As almost 59% of existing decentralized applications run on the Ethereum platform, upgrades like these on the Avalanche network are necessary for future interoperability.
Emin Gun Sirer, the Ava Labs’ CEO, said, “The new Avalanche Bridge is a leap forward in bridging technology, but most importantly, it is a dramatic improvement in experience for users and developers across the Avalanche community. It will be a growth engine for the next phase of growth on Avalanche, and set a new standard for secure and efficient cross-chain interoperability.”
2. The Launch Of Avalanche Rush
Now let’s talk about the Avalanche Rush. The Avalanche Foundation launched this $180M liquidity mining incentive program to introduce more applications and assets to its rapidly growing DeFi ecosystem. Avalanche Rush has brought two of the largest DeFi protocols by total value locked (TVL), Aave and Curve, to the platform. The program will also bring blue-chip DeFi applications.
The Avalanche Rush incentive program has successfully exposed Avalanche Foundation’s commitment to scale DeFi. It also aims to create a more accessible, decentralized, and cost-effective ecosystem.
Michael Egorov, Chief Executive Officer at Curve Finance, commented on the launch of Avalanche Rush.
“Avalanche Rush will be a showcase for users to see the power of Avalanche, and dive into a vibrant community at the cutting edge of decentralized finance,” said Emin Gün Sirer, Director at the Avalanche Foundation. “The combination of Aave, Curve, and Avalanche will create really interesting synergies that DeFi users will be excited about.”
3. Deloitte’s Strategic Alliance With Ava Labs
Ava Labs is the firm that developed Avalanche and launched the coin in September 2020. AVAX’s recent surge in price was hugely driven by the partnership between Deloitte and Ava Labs. The partnership intends to deploy Avalanche’s blockchain to support Deloitte’s work with US’s Federal Emergency Management Agency (FEMA).
The partnership will create a new disaster recovery platform that uses the Avalanche blockchain. Thanks to the network’s utilities, it will help state and local governments easily demonstrate their eligibility for federal emergency funding. In addition, Avalanche offers a secured environment that helps in quickly gathering, processing, and authenticating required documentations. This will eventually improve the accuracy of federal disaster claims. Moreover, Avalanche is also an eco-friendly platform, aligning with Deloitte’s commitment to green technology.
Why Avalanche Is Going To Explode This Year
Leaving footprints on Web 3.0, Avalanche is one of the most potential cryptocurrencies to invest in now.
There has been a significant growth of DeFi on the Avalanche network recently. This can be seen in the increasing total value locked (TVL) in protocols on the networks, like Pangolin and Benqi Finance, which recently surpassed a TVL of $300 million. The platform aims to offer a smooth running experience across multiple financial assets and activities.
The Avalanche foundations have also launched a $3M liquidity mining initiative with BENQi, a liquidity protocol native to Avalanche. If Ethereum fails to tackle the issues of high transaction costs soon, more assets and liquidity will continue to migrate to chains like Avalanche. This will eventually increase their DeFi ecosystem in size and value, pushing the investability quotient of AVAX.
Avalanche also offers several new possibilities for developers and creators of dApps on the blockchain. The team dubs their platform the Internet of money, as it intends to act as a central hub and exchange for the future of financial transactions.
Read Also: Why Avalanche Will Skyrocket
The Bottomline
Innovations and novel technological advancements are necessary to make transactions as smooth and seamless as possible in the future. This is what Avalanche brings into the blockchain space. By introducing a fast and reliable network, it focuses on elevating the user experience. These features and the latest developments to its DeFi ecosystem would drive AVAX to likely explode in 2023, making it a good buy now.
However, following the latest developments and doing due diligence independently before investing in any cryptocurrencies is always recommended.
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Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
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