Avalanche Bridge To Ethereum Records A 70% Drop In Value Transfer, Concern For AVAX Price?

Dalmas Ngetich

1 year ago

3 mins read

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The amount of funds flowing through the Avalanche Bridge is down 70% in the last 24 hours, DeFiLlama data on May 31 shows.

70% Drop In Activity In The Avalanche Bridge To Ethereum

Over the past day, the bridge has facilitated $2,634,828 worth of transactions and processed $22.4 million in transfers in the last week.

The bridge has processed 278 transactions in the past day, totaling around $2.6 million. It shows a sharp decrease in activity between Ethereum and Avalanche, among the world’s largest smart contract platforms.

The Avalanche Bridge connects the Avalanche’s C-Chain, one of the three interoperable blockchains defining the low-finality platform, with Ethereum.

Since C-Chain is compatible with the Ethereum Virtual Machine (EVM), assets can be smoothly transferred from Avalanche to Ethereum and vice versa.

The compatibility with the EVM coupled with the decentralization of the bridge means users can move funds between the two blockchains securely.

Avalanche, unlike Ethereum, is explicitly designed for decentralized finance (DeFi) dApps. It boasts high processing speeds, relatively low fees, and is decentralized. However, it lags Ethereum in activity, judging from the total value locked (TVL).

According to DeFiLlama data, over $26.5 billion of the approximately $48 billion of all DeFi TVL is managed by dapps on Ethereum.

More Assets Moved Between Avalanche And Bitcoin

Notably, while there is a worrying contraction in the number of transactions and value between Avalanche and Ethereum, the Avalanche Core Bitcoin Bridge is booming.

On May 31, there was a significant increase in transfers and value, with a spike of 2,726%. Within 24 hours, assets worth over $6.5 million were transferred through the bridge. This is roughly half the average weekly transfers which stand at $13.81.

Bitcoin transferred to the Avalanche C-Chain from the Bitcoin network is tokenized and is compliant with the ERC-20 standard. In that case, it can be moved to Ethereum and used to participate in DeFi.

Scanning the activities stemming from Avalanche to Bitcoin and Ethereum, the disparity could suggest that more users are moving their assets to and from Bitcoin.

However, no direct fundamental event could explain why more users are bridging tokens from Bitcoin and cutting down engagement with Ethereum.

In the last 24 hours, Bitcoin, Ethereum, and Avalanche prices have been under pressure, falling from recent highs. To illustrate, AVAX is down 6% from May 28 highs, extending losses from mid-April. AVAX is down 35% in the last six weeks and retesting March 2023 lows.

AVAX Price On May 31| Source: AVAXUSDT on Binance, TradingView

AVAX may slip below a critical multi-week support level if sellers double down. In that case, it could drop to December 2022 lows at around $10.

Feature Image From Canva, Chart From TradingView

Dalmas Ngetich

Dalmas, a seasoned crypto reporter, brings a unique perspective to the industry. His specialization in NFTs, blockchain, DeFi, and blockchain news for NewsBTC, combined with a background in mechanical engineering and over a decade of experience in journalism, has allowed him to craft over 10,000 news and feature articles over the past eight years. His diverse range of topics, including technology, Forex, and finance, reflects his comprehensive understanding of the crypto landscape.

His technical expertise and analytical skills have been recognized and featured by leading news outlets such as Investing.com, CoinTelegraph, Entrepreneur, Forbes, and other authority sites. Notably, he broke key news, including the Ripple and MoneyGram partnership, cementing his position as a thought leader in crypto.
The news exploded. Over 100,000 people devoured this meticulously crafted report, from seasoned investors to curious newcomers. His analysis wasn't just dry facts and figures; it crackled with insight, dissecting the implications of the partnership and its potential impact on the future of finance.

His deep understanding of the financial markets, technological advancements, and blockchain developments has made him a respected voice in the industry.

Dalmas is also the founder of BTC-Pulse, a crypto news site, further demonstrating his commitment to the field. He firmly believes that DeFi and NFTs are here to stay and will continue to drive financial inclusion.

Coming from Nairobi, Kenya, it is easy to see the source of his inspiration: Across Africa, millions lack access to traditional banks. Remote villages, limited documentation, and high minimum balances create insurmountable barriers.

DeFi, not just Maker or Aave, for example, but think of Bitcoin and USDT, cuts out the middleman. Forget banks with their limitations.
Even so, DeFi isn't a magic solution. The continent still struggles with reliable internet access, and educational campaigns highlighting the benefits of this wonderful solution are insufficient. Moreover, even for those interested, understanding DeFi can look like learning a new language.

Dalmas is here to help make the tech easy to understand and digestible, even for beginners.
The story of DeFi in Africa is still being written. Challenges abound, but the promise of a more inclusive financial future is a powerful motivator. With innovation and collaboration, Dalmas firmly believes that DeFi could become the key to unlocking Africa's full economic potential.
This possibility and its immense value motivate Dalmas to continue breaking key DeFi innovations and more across the globe. His engineering background further enhances his ability to deliver well-thought-out pieces that blend technical insight with clear, impactful reporting.

Beyond his professional achievements, Dalmas is deeply passionate about technology and politics. Policies drive adoption, and being at the forefront and keeping up with how they evolve is crucial for the sphere to mature.

When Dalmas is not closely monitoring the latest crypto events, he can be found in nature, exploring the picturesque countryside, and traveling with his family and friends. His love for adventure and discovery perfectly complements his investigative and reporting skills.
You can connect with Dalmas on X: @Dalmas_Ngetich, or contact him on Telegram @Dalmas_Ngetich.

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