The price of the AVAX token, like all cryptocurrencies, is primarily determined by supply and demand. AVAX is the native token of Avalanche, a network composed of three blockchains, aimed at replacing Ethereum as the leading blockchain for dApps and smart contracts. Avalanche aims to achieve its goals through improved scalability at a speed of up to 6,500 transactions per second. The network consists of the X-Chain, the C-Chain and the P-Chain. These individual blockchains each perform different tasks, and depending on the use case, different consensus mechanisms are used.
New developments and the integration of various projects into the network naturally also increase the interest of investors and users. Developments that influence the positioning among competitors can therefore also increase the price of AVAX tokens. Avalanche or AVAX is often referred to as a coin. However, the AVAX cryptocurrency is not a coin, but the native token of the Avalanche platform.
Avalanche (AVAX) course: Milestones and important events
The native token of the Avalanche network, AVAX, was released in September 2020 with a total supply of 720 million units, shortly after, the cryptocurrency recorded a steep drop. In August 2021, the Avalanche price doubled in a very short time. The all-time high for Avalanche was reached in November 2021 with a price per AVAX token of $144.96. The most important events and milestones in the Avalanche course so far were:
- 2020: Release
- February 2021: $98 / AVAX
- February 2021: $66 / AVAX
- August 2021: $27 / AVAX
- November 2021: $144.96 / AVAX
- December 2022: $12 / AVAX
- February 2023: $22 / AVAX
The Avalanche course after release
Just a few months after its release, the AVAX token recorded a rapid increase in February 2021. This was followed by an equally rapid loss. The reason for this was a high number of transactions which had significantly slowed down the network. This development uncovered a coding error, also known as a bug. As a result, many investors lost confidence in the network, and the Avalanche price fell.
Avalanche's expansion in the world of decentralised finance (DeFi)
In August 2021, Avalanche announced a funding programme of 180 million US dollars. DeFi protocols were integrated into the network and users of these protocols were rewarded with additional AVAX tokens. This allowed Avalanche to establish its position in the world of decentralised finance. The price per AVAX token doubled shortly after the announcement of this development, reaching a value of around $27.
All-time high: Avalanche (AVAX) in the 2021 crypto bull run
In 2021, many cryptocurrencies, including AVAX, saw rising prices. Experts refer to these phases as a bull runs. Among the reasons for this was a generally increasing interest in cryptocurrencies. Many large investors and companies like Tesla and Elon Musk announced investments in digital assets. Additionally, more and more companies, such as PayPal, started to accept cryptocurrencies as a form of payment. Due to decreasing interest rates on traditional investments, private investors also looked for new asset classes with lucrative returns. Cryptocurrencies such as Avalanche (AVAX) enjoyed increasing interest. With increased demand, prices also rose sharply and many tokens and coins, including Avalanche (AVAX), reached all-time highs.
The Avalanche (AVAX) direction in the 2022 crypto winter
In 2022, a period of falling prices for cryptocurrencies, including Avalanche, set in. Experts refer to these times as a bear market or crypto winter. There were various reasons for these falling prices. Many countries planned regulatory measures for cryptocurrencies. In China, for example, all cryptocurrencies were completely banned, and in India a law was passed that prohibited private wallets. With investor fears about governmental influence on profits, courses and taxation, interest in cryptocurrencies declined significantly. Moreover, many investors wanted to realise their profits from the bull run in 2021 and sold their coins and tokens. This led to an increased supply with decreasing demand. The course of Avalanche also fell significantly, reaching a low of around $12 per AVAX token in December 2022. But developments within the crypto scene also shook investors' confidence. For example, the crypto platform FTX collapsed, and the Terra blockchain, which had entered into a cooperation with Avalanche, crashed. A multitude of new coins and tokens without a corresponding business plan or roadmap came onto the market and increasingly unsettled investors.
Price prediction for the AVAX token
In the previous years, the crypto market has often fluctuated between bull runs and bear markets. Many forecasts therefore see the prices, including for Avalanche, rising again in the coming years. With advancing development and increasing competitiveness from established platforms like Ethereum, experts assume that the price per AVAX will not only recover in the coming years but will also reach a new all-time high. However, the past prices and forecasts are not an indicator of future performance.