The rise in transactions is driven by stablecoin usage with most of the growth coming from transfers under $10.
Avalanche’s network activity is growing in multitudes.
The network’s primary blockchain recorded over 1.2 million transactions on Monday, a sharp rise from last year when the figure was ranging between 100,000 and 250,000 daily transactions, per data platform Artemis.
The bulk of the transaction activity comes from stablecoins, according to a Tuesday report from blockchain analytics firm CoinMetrics, which stated, “most of the growth stems from low-value transfers under $10, with the majority clustered in the $5-10 range.”
Avalanche passing 1 million daily transactions comes after the network’s December upgrade called Avalanche9000, the network’s largest since its mainnet rollout, which resulted in an over 90% reduction in transaction fees on the blockchain. It also included a number of improvements aimed at increasing decentralization and built-in regulatory compliance, per a blog post written by Avalanche developers.
One driver of increased transactions in the year stems from smart contracts from decentralized exchange aggregators. In decentralized finance, liquidity is spread across several on-chain exchanges where the price of a cryptocurrency differs on each venue, but an aggregator helps traders find the best price by combining the fractured liquidity together.
The launch of NFT game MapleStory Universe in May also may have boosted transaction activity. “The timing of MapleStory’s launch closely aligns with the rise in Avalanche C-Chain transactions and active addresses. While not definitively linked, the parallel increase in USDC transfer counts may reflect users onboarding into the ecosystem,” the report said.
Luigi D’Onorio DeMeo, chief strategy officer at Ava Labs, the firm developing Avalanche, pointed to meme coin trading as well.
“Meme coin activity helps to bring in exogenous liquidity and onboard a certain retail audience,” DeMeo told Sherwood. Meme coin trading “is a good initial funnel for users that can be subsequently introduced to all the gaming and DeFi happening on Avalanche,” DeMeo added.
Even though Avalanche is seeing a rise in transactions, the price of its native token, AVAX, has not had a similar growth trajectory. The cryptocurrency has dropped 8% in the last 24 hours and about 34% from last June.
