Avalanche (AVAX) Traders’ Optimism Wanes as Stars Arena’s Security Breach Signals the Promising Move May Be Over
Hitesh Malviya, a crypto analyst, had painted a hopeful future for Avalanche’s native token, AVAX, with a technical breakdown shared on Twitter. His analysis suggested that AVAX might be on the brink of a pivotal price shift, targeting around the $20 mark. However, unfolding events, particularly from Stars Arena, may have changed the trajectory. Here’s an in-depth look:
Network Usage Peaks, Then Teeters?
Drawing attention to the network metrics, Malviya revealed that AVAX registered an impressive 300% uptick in daily burn fees over a mere span of four days. For the uninitiated, these fees are obliterated with every Avalanche transaction, effectively resulting in a growing scarcity, which, in theory, could bolster AVAX’s price.
This remarkable escalation in burn rates aligns with data available on Avascan, the block explorer for Avalanche. Malviya’s prediction was that such a trend, if sustained, could culminate in a virtuous cycle, drawing in more users, fueling more transactions, and continually decreasing the AVAX supply.
The Role and Rumble of StarsArena
Malviya shed light on StarsArena, a trending play-to-earn game, emphasizing its pivotal role by accounting for a whopping 50% of daily transactions on Avalanche. Data in the public domain corroborates this substantial transactional footprint.
Malviya’s projections posited that if StarsArena can maintain its momentum for just another week, it could be a significant catalyst for AVAX burn rates and more widespread adoption in the foreseeable future. While Dune Analytics charts reveal StarsArena’s undeniable early success, the future seems a tad uncertain.
The Turning Point
In theory, Malviya’s analysis was robust, making a case for a potential AVAX upswing. However, crypto trading, with its multifaceted variables, always warrants caution. It’s essential to remember that price trends are influenced by myriad factors, including market dynamics, significant stakeholder movements, and unpredictable events.
Driving this point home, a mere two hours post his original analysis, Malviya relayed a rather somber message. Citing an official StarsArena communication, he alerted the crypto community to a significant security breach within StarsArena’s smart contract. Such revelations could potentially eclipse any previously anticipated bullish momentum for AVAX.
The Way Forward
Despite this setback, Avalanche’s merits as a platform — particularly its rapid transaction capabilities and Ethereum interoperability — remain undeniable. If StarsArena can navigate its current predicament and other decentralized applications flourish on Avalanche, AVAX might still witness renewed optimism. As always, astute traders will keep their fingers on the pulse, acclimatizing swiftly to the unforeseen challenges that occur in the crypto industry.
We recommend eToro
Wide range of assets: cryptocurrencies alongside other investment products such as stocks and ETFs.
Copy trading: allows users to copy the trades of leading traders, for free.
User-friendly: eToro’s web-based platform and mobile app are user-friendly and easy to navigate.
eToro offers staking for certain popular cryptocurrencies like ETH, ADA, XTZ etc.
