After the AWS news, the AVAX price wasn’t the only metric that saw a rapid rise. On January 14, the Avalanche Network reached a year-to-date high of $31,218 AVAX fee received. The increase in fees compared to the previous 30 days was 59%, which indicates that positive price increases helped increase the fees received by the network.
Avalanche Network fee and AVAX price. Source: TokenTerminal
While Avalanche’s fee base is growing, it still lags behind EVM-compatible blockchains like Ethereum and Binance Chain.
BNB
pointers down
$320
optimism (OP) and polygon
matic
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$1.3300
. Over the past 30 days, Avalanche Fee has ranked ninth among all blockchains.
The most important blockchains are arranged in order of graphics. Source: TokenTerminal
Notably, second-tier competitor Polygon earned nearly four times the amount in fees compared to the Avalanche. Even with thaAvalanche’s impressive growth in 2023, the network will need to significantly increase fees to bypass more blockchains.
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Active addresses and disabled users
A sign of the health of a blockchain is the number of active addresses, users, and transactions. Despite reaching a year-to-date high on Jan. 18 of 1.84 million transactions, the number of Avalanche transactions is trending lower.
A similar downtrend is seen when looking at active addresses in the avalanche ecosystem. Active addresses refer to the transactions being played on unique wallets for a given day. After reaching a year-to-date peak of 54,978 active addresses on January 31, only 34,624 active addresses were registered the following day.
Addresses and active transactions. Source: Avalanche
The downward trend in Avalanche activity is leading to further decoupling of other blockchains. According to TokenTerminal, Avalanche’s daily active users (ATH) is an all-time high of 131,000, which pales in comparison to Polygon’s ATH of 737,000. Avalanche is now far from its all-time high of daily users, with just 44,000 logged.
Blockchains ranked by daily active users, Source: TokenTerminal
For a blockchain to generate sustainable fees, there must be daily active users participating on the network.
AAVE dominates Avalanche DApps
Avalanche active users seem to prefer using Aave
avi
pointers down
$82.89
on the AVAX blockchain. Over 36% of all Avalanche transactions flow through the Aave protocol. Investors have bet more than $353 million on Aave’s Avalanche issuance, far outpacing the second most popular protocol with its proven total value (TVL), Trader Joe’s decentralized platform (DEX).
Top Avalanche DApps. Source: Defillama
While Aave and Trader Joe lead the Avalanche blockchain, when looking at DEX activity on other blockchains, they see much lower trading volume. The size of the DEX is directly related to the fees received by the protocol.
Ethereum DEX activity leads the way with more than $1.6 billion in daily volume, while Avalance only sees about $104 million.
DEX activity by blockchain. Source: Defillama
While Avalanche is currently seeing exponential growth from the AWS announcement, the blockchain is still small compared to competitors. The goal of the AWS partnership was to help increase network activity by reducing barriers to entry. Reaching the target may lead to increased adoption of avalanches but other ecosystems seem to have hit it big and early.
