Is there hope after AVAX breaks to a new low? Understanding the Avalanche chain is key to grasping the next market move.

Recently, AVAX’s price dropped to $12.11, hitting a new low, and many people have begun to question this project that was once praised by V God. But if you only look at the price and ignore the fundamentals, you might miss a key opportunity. Today, let’s analyze the logic behind AVAX—why did V God say that the Avalanche protocol has historical significance?

Why does V God favor Avalanche?

Ethereum founder Vitalik Buterin once directly stated on Twitter that Avalanche’s breakthrough in consensus mechanisms can be compared to Bitcoin. This is not a casual remark.

The core reason lies in the innovation of Consensus 3.0. Everyone knows that blockchain consensus mechanisms have an eternal contradiction—decentralization, low energy consumption, and high efficiency—these three are basically mutually exclusive:

• Bitcoin’s PoW: Decentralization is fine, but energy consumption is huge, and speed is extremely slow
• Traditional BFT: High efficiency, low cost, but serious centralization issues

Avalanche has managed to balance all three by introducing a repeated random sampling verification mechanism, combining the advantages of both. Even more impressive, it adopts a three-chain parallel architecture (X-Chain for transactions, P-Chain for governance, C-Chain for smart contracts), with each chain performing its own function, confirming transactions in just 2 seconds—this is a significant reduction compared to Bitcoin (1 hour) and Ethereum (6 minutes).

Current state of the Avalanche ecosystem: from fringe to mainstream

What do the latest data show? As of the most recent statistics, Avalanche has hosted over 500 projects, with 134 in the DeFi ecosystem, covering core areas such as lending, trading, and staking. Notable projects include AAVE, Benqi, GMX, Trader Joe.

But honestly, compared to Ethereum, it still lags behind:

• Avalanche: TVL approximately $1.51 billion, 180,000–200,000 daily active users
• Ethereum: TVL approximately $61.76 billion, 750,000 daily active users

The gap looks huge, but don’t overlook Avalanche’s growth pace—recently, it has made new strides in RWA (Real World Assets) and institutional-grade DeFi, with collaborations involving Deloitte, J.P. Morgan, and other traditional financial giants. These are potential long-term growth points.

The real background of AVAX

Regarding the team, don’t underestimate these three founders—Emin Gün Sirer is a computer science professor at Cornell University, specializing in distributed systems; the other two, Kevin Sekniqi and Maofan Yin, are also technical elites. This is not a decorative team but real algorithm experts.

Funding history also speaks volumes: seed round in 2019 raised $6 million → private placement in 2020 raised $12 million → public offering raised $42 million → OTC token sales in 2021 raised $230 million → another $250 million raised in 2024. Capital markets have never lost confidence in this project.

Token distribution: total supply of 720 million tokens, current circulating supply 429 million, circulation rate 59.66%. But there is a risk point—over 30% of tokens are held by the team, foundation, development fund, and strategic partners combined. Although nominally dispersed, the control risk cannot be ignored.

Price trend: the story from $2.80 to $144.96

The price trajectory of AVAX actually illustrates the issue well:

• July 2020: launched at $4.9, then fell to a historical low of $2.80
• Early 2021: rebounded to $30, a 900% increase
• July 2021: surged to around $120, a 1200% increase
• 2022-2023: oscillated between $10–$30 amid bear market
• 2024: stabilized around $30–$40, with increased institutional attention
• Early 2025 to May: rose from around $40 to a high of $75 (catalyzed by the April Hyper SDK upgrade), then adjusted between $60–$65
• Current: $12.11, down 91% from the all-time high of $144.96

What caused this sharp decline? Overall crypto market volatility, macro policy uncertainties, profit-taking pressures, and other factors all played a role. But from another perspective, this low level also presents an entry opportunity.

AVAX’s advantages and concerns

Clear advantages:

1. Stronger security: requires 80% of nodes to maliciously attack the network, compared to Bitcoin and Ethereum’s 51%
2. Fast speed: transaction confirmation in 2 seconds, Gas fees only $0.05–$0.3, far lower than Bitcoin($2–$15) and Ethereum($1.5–$5)
3. Significant market cap: $5.2 billion, ranking high among global cryptocurrencies, no longer a small project

Risks to watch out for:

1. Centralization risk: over 30% of tokens held by core stakeholders, potential for market dumps
2. Short history: only born in 2020, technology and applications still need market validation, network outages occurred in 2022
3. Lack of seasoning: hasn’t experienced a full bear market, higher uncertainty compared to BTC and ETH

Should you buy now?

This is the most practical question. AVAX is currently at $12.11, a staggering decline from its peak, but that doesn’t mean the bottom is in sight. Technically, $60 is a support level, and $75 is a short-term resistance. Market focus is on whether progress in RWA and traditional finance collaborations can bring new catalysts.

The outlook is not pessimistic: if the crypto bull market continues and the ecosystem accelerates expansion, three-digit prices could be challenged. But it also depends on macroeconomic conditions and regulatory changes, which are uncertain factors.

AVAX is fundamentally a project with ideas, technology, and background, but the current test is whether its ecosystem can truly scale and whether the team can deliver on promises. Short-term volatility is inevitable; long-term strategy remains the right path.