Competitor of Ethereum hits ATH and retreats

The price of most cryptocurrencies is in the red if you only consider the last few days.

After the Bitcoin price decided to retreat from its historical highs to prices seen months ago, Avalanche (AVAX) is one of the few projects that still manages to have a good appreciation in the week.

In the last 7 days, only 20% of the TOP 100 largest cryptocurrency projects (in terms of market capitalization) are positive.

AVAX price

Avalanche is one of the few that is still winning, with its AVAX token rising by 35.6% in the last week, even with a sharp drop of 11.1% today (last 24h).

The drop may have been quite natural, as the cryptocurrency rose to its historic high of $144.96 2 days ago (on 11/21), even reaching the TOP 10, and now the price is in correction , dropping to $127.90 (at 13% of its ATH, ie, its all-time high).

Currently, its market cap (“market capitalization”) is in the order of US$28.6 billion.

What is and what does Avalanche (AVAX)?

Avalanche is designed to provide a network where decentralized finance (DeFi) products can be built, just like Ethereum.

DeFi products are experimental applications that provide automated financial services without involving an intermediary.

But building on Ethereum, the network behind the second largest cryptocurrency by market value, can be expensive and slow when network activity increases.

Ethereum can only process around 30 transactions per second, and it’s not uncommon for network transaction fees to run into the hundreds of dollars.

Avalanche can process up to 4,500 transactions per second, with network fees that can be less than $1 for a single transaction. However, large transactions can be more expensive.

Ethereum developers are currently working on a long-awaited ETH 2.0 update, which aims to make the network faster and less expensive to use, and therefore more competitive with second- and third-generation blockchains like Avalanche and Solana.

Investors eyeing the “next Ethereum” may be part of the reason the Avalanche’s value is skyrocketing, while Bitcoin and Ethereum continue to experience selloffs.

Zhu Su, CEO of Singapore cryptocurrency hedge fund Three Arrows Capital, said on Sunday that he has “abandoned Ethereum despite supporting it in the past” — and that he is an investor in AVAX.

Su called the behavior of the Ethereum community “disgusting” and said that Ethereum users were “furious” at how expensive the blockchain had become.

The price of AVAX has continued to rise since he made these comments.

He could be right too: using Avalanche to do a DeFi transaction costs a fraction of what it costs on Ethereum and is much faster – usually instantaneous.

Ethereum can take a long time, sometimes hours, as its miners prioritize processing larger and more expensive transactions.

And looking at AVAX’s recent rise, it looks like DeFi investors and users are enjoying the benefits of the blockchain.

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Thomas Miles

Cryptocurrency is the most recently discovered currency which will be likely at the help of modernization across the next few decades. With a limited control from the government, the crypto market is independent of many features of a sound market as we know it. Thomas brings these stories to us by weaving them into articles of general importance to all those looking at the fluctuations in the market, or new entries. Thomas is also the founder of Bulletin Bits and is an excellent leader. His leadership is the kind that makes him the most knowledgeable and experienced on the team. His wonderful work ethic and attitude are worthy of imitation!

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