Avalanche (AVAX) just hit a new ATH, but what’s really behind the price surge?

AVAX price soared to a record high as heavy inflows enter the protocol through its cross-chain bridge and institutional investors pledge $230 million in funding for the rapidly expanding Avalanche ecosystem.

On Sept.16 Avalanche (AVAX) price hit a new all-time high at $68.89 and over the last few months the project has risen to challenge the Ethereum (ETH) network’s dominance among smart contract platforms. According to the project’s website, the layer-one protocol capable of surpassing 4,500 transactions per second (TPS) with a time to finality of less than 2 seconds.

Data from Cointelegraph Markets Pro and TradingView shows that since hitting a low of $32.10 on Sept. 7, the price of AVAX has rallied 111% to establish a new all-time high on Sept. 16 as its 24-hour trading volume spiked 200% to $2.8 billion.

AVAX/USDT 4-hour chart. Source: TradingView

Three reasons for the surging price of AVAX include the recent completion of a $230 investment round by large capital funds, the continued migration of liquidity to the Avalanche network and new integrations and protocol upgrades that help improve the user experience.

Big funds back Avalanche

The jump in momentum seen in AVAX price on Sept. 16 came following the announcement that a handful of large funds including Polychain Capital, Three Arrows Capital and Dragonfly capital took part in a $230 million funding round for the project.

This marks the largest investment into the Avalanche ecosystem to date and indicates that larger institutional players are starting to take a keen interest in the Ethereum competitor.

The Avalanche network is cross-chain compatible with Ethereum meaning any tokens or projects that operate on Ethereum can fully migrate to the Avalanche ecosystem and take advantage of its higher throughput capabilities and lower transaction costs.

With no definitive date on when Eth2.0 will be fully operational or what its final capabilities will be, networks like Avalanche now have an opportunity to make the case for why they are a better choice, which could lead to an increase in their market share.

Liquidity migration and rising TVL

A second reason for the building strength seen in AVAX has been the continual migration of assets from networks like Ethereum to Avalanche to participate in its growing decentralized finance ecosystem.

Evidence of the asset migration can be found in the total value locked (TVL) data provided by Defi Llama, which shows that the TVL on Avalanche has been climbing rapidly since Aug. 19 and reached a new record high of $2.17 billion on Sept. 16.

Total value locked on Avalanche. Source: Defi Llama

The rise in TVL is largely due to the launch and growth of several successful decentralized finance (DeFi) protocols on Avalanche including Benqi (QI), Trader Joe (JOE) and Pangolin (PNG).

Related: Bull flag breakout pushes Avalanche toward $80 as AVAX price hits another record high

Partnerships and crypto-related integrations

A third factor that has helped boost the value of AVAX has been a series of partnership and integration announcements that have excited investors and put the spotlight on the project.

The Avalanche NFT ecosystem has seen an influx of interest thanks to a partnership with the sports card and memorabilia company Topps, which launched its “Inception” NFT digital collectibles series on the network.

There is also a vote underway in the Aave community, one of the top DeFi protocols in the cryptocurrency ecosystem, to see if investors want to see AAVE launch on the Avalanche network. A vote of approval could lead to a further increase in TVL on Avalanche as assets held in AAVE on Ethereum have the potential to be migrated to AAVE on Avalanche.

According to data from Cointelegraph Markets Pro, market conditions for AVAX have been favorable for some time.

The VORTECS™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historical and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

VORTECS™ Score (green) vs. AVAX price. Source: Cointelegraph Markets Pro

As seen in the chart above, the VORTECS™ Score for AVAX spiked into the green and reached a high of 86 on Sept. 13, around 24 hours before the price increased 40% over the next two days.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Stanford researcher-led Pledge raises $3M for decentralized lending protocol

Researchers from Stanford University and U.C. Berkeley contributed to the development of the crypto-asset lending platform.

Decentralized lending protocol Pledge has secured $3 million in investments for its cross-chain ecosystem focused on long-term financing, highlighting continued innovation in the DeFi sector. 

The investment round was led by DHVC, a Palo Alto-based venture capital firm, with additional participation from U.C. Berkeley professor Gary LaBlanc and Stanford University community members Ray Wong and Torsten Wendl. The raise will support Pledge’s mission to become a premier crypto-asset lending platform that eventually paves the way for tokenized real-world financial assets.

Pledge was created by a group of blockchain-focused researchers at Stanford University, including professor David Tse, Nicole Chang, Ray Wong and Torsten Wendl. Aforementioned professor Gary LaBlanc also contributed to the protocol.

Utilizing Binance Smart Chain, Pledge aims to facilitate long-term financing for crypto holders, something the researchers say has yet to be addressed in the industry. The protocol achieves this goal by allowing users to diversify their portfolios with non-crypto assets without being exposed to interest-rate volatility.

The protocol is powered by Pledge Tokens, or PLGR, which have a total supply of 3 billion. No market data is currently available for PLGR.

DeFi lending markets have exploded in popularity this year, attracting an influx of new users on the promise of higher yields and increased access to new markets. While Aave dominates the DeFi lending market, several protocols have launched over the past year, each one providing its own value proposition.

Related: DeFi attracts 2.91M Ethereum addresses, according to ConsenSys

Currently, just under $44 billion in total value has been locked into DeFi lending markets, according to industry data. That accounts for just over half of the total decentralized finance market.

DeFi’s growth has attracted unwanted attention from regulators who are growing more concerned about investor protections and whether certain assets fall under federal security laws. As Cointelegraph recently reported, the United States Securities and Exchange Commission has warned cryptocurrency exchange Coinbase that its proposed yield program violates securities laws.

Related: SEC vs. Coinbase: Alex Mashinsky says Celsius will have to ‘wait and see’ on fallout

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Digital asset exchange Blocktrade concludes $25M investment round

The company underwent a successful securities offering earlier this year, receiving support from over 6,000 European investors.

Luxembourg-based Blocktrade has become the latest cryptocurrency exchange to receive major backing from venture capitalists, offering further evidence that digital asset startups are becoming a prime target for investment funds. 

Private investors across 33 countries participated in the $25.8 million, or 22 million euros, Series A round, Blocktrade announced early Tuesday in Europe. The investors were not disclosed.

Blocktrade said the funding will go towards improving internal operations, especially in the areas of security, fiat onramps and market-making. The company also said it would allocate more resources to growing its potential user base, as well as pursue other business partnerships.

“Blocktrade is more than a classic crypto exchange: we are building a complete ecosystem around digital assets, which provides our users with much more than just access to trading tools,” said Bernhard Blaha, who was appointed the CEO of Blocktrade in late 2020.

Blocktrade was founded in 2018 but was later acquired by Cryptix AG, a Swiss venture capital firm that specializes in digital payments. Under the leadership of Cryptix, Blocktrade underwent a securities offering in early 2021, attracting investments from over 6,000 participants across Europe.

Crypto-focused startups have generated billions of dollars in funding this year, a testament to the growing appeal of blockchain and cryptocurrencies among venture capitalists and other private investors. Exchanges have been at the center of the funding frenzy, with the likes of Mercado Bitcoin, Bitso, FTX and Pintu generating nearly $1.4 billion in funding over the past few months.

Related: FTX smashes crypto funding record with $900M raise to become exchange decacorn

These companies follow on the heels of Coinbase’s massive IPO in April that further pushed digital currency trading into mainstream consciousness.

Crypto trading is likely to intensify now that more investors have confirmation of a two-pronged bull market for Bitcoin (BTC) and other assets. The BTC price smashed through $46,000 on Monday amid news that U.S. lawmakers are planning to introduce new crypto-focused amendments to the infrastructure bill.

Related: Bitcoin ‘awaiting second leg of bull market’ as BTC price hits $46K 3-month highs

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Anon-powered options: DeFi platform Premia goes live

An all-anon team is hoping to realize the long-awaited dream of a flexible DeFi options platform

The Anon Powered development team has announced today the launch of Premia, the latest decentralized finance (DeFi) options platform live on Ethereum. 

In an interview with Cointelegraph, the group of semi-anonymous developers behind Anon Powered — who collectively requested that they be referred to as “members of the Premia Republic,” the name for Premia’s forthcoming DAO — said that out of the gate users will be able to write, sell and exercise “American-style covered calls and puts,” which can be exercised prior to the option expiration date.

Premia’s launch adds to an increasingly crowded DeFi options marketplace, joining projects such as Auctus, Hegic, and Opyn. However, members of the Premia Republic believe that their project will be able to stand out due to blend of features, including an architecture which leverages ERC-1155s, a Primary Bootstrap Contribution phase in lieu of a VC raise, and a developmental philosophy they believe reflects the wider DeFi ecosystem — one that is open to all, regardless of credentials (or even a verifiable public face).

“I think something’s that’s been core to our ethos while doing all this is trying to have a group that is a bunch of honest, anonymous people who want to change the view of anonymity in the landscape and let the code speak for itself,” the members said.

Flexible standards

The members of the Premia Republic — one of whom claims to currently work at a tradfi broker-dealer, which Cointelegraph could not confirm — said that they largely met through crypto-focused chat rooms on Discord and Telegram. The first project they produced under the Anon Powered umbrella, Don’t Buy Rope, was one of the earliest NFT yield farming experiments

As a result of their work on Don’t Buy Rope, the team is proficient in working with ERC-1155s. Often used for minting NFTs, the ERC-1155 standard allows for a single contract to mint multiple fungible or non-fungible tokens. This standard is what enables Premia’s more flexible strike times, a feature that many of Premia’s competitors don’t currently offer.

“Some of the solutions that you’re seeing are done in a ERC-721 way,” said one Republic member. “And that is, in a traditional finance sense, is considered an OTC — over-the-counter trade. Each ERC-721 is going to be specific to the strike price. […] By using an ERC-1155 we can keep this listed derivative mentality, which is fungible, and create this secondary market where you can buy and sell them after the fact.”

Likewise, their native token also comes with some unique twists. At launch, there will be an “interaction mining” program similar to liquidity mining, where users who write, buy, and sell options will receive uPremia (“uncut Premia”) tokens “proportionally to the fees that are paid” to the protocol. uPremia is nontransferrable, but can be staked to earn protocol fees, which will be distributed to stakers as a transferable, tradable PREM token.

This architecture won the team a glowing review from Solidity Finance, the auditing firm that reviewed the Premia contracts.

“Premia was one of the best projects we’ve reviewed in the sense of security and logical construction of code – the development team on the project is extremely impressive,” said a Solidity Finance rep.

Anon Powered

Perhaps more interesting than the technical details of the platform is the vision behind it. Members of the Premia Republic said that there was internal debate about whether or not to bootstrap the launch of the protocol with a venture capital raise, especially given the perhaps profligate sums some projects have been fetching as of late. 

Ultimately, they decided to go a different route.

“The ethos behind Defi in our eyes is, ‘open to the people,’” said one member — and giving favorable terms to deep-pocketed investors doesn’t fit that vision.

But for all the idealism, there’s still practicalities: after the launch of their initial product, the team has capital needs for developer hiring. As a result there will be a “primary bootstrap contribution” that will be open to all.

During the one-week PBC, users will be able to send ETH to a contract and receive Premia tokens on a bonding curve. Because of DeFi’s open and permissionless nature, both VC whales and individual investors will be able to participate.

The team in some ways faces a steeper adoption curve because of these positions. After a DeFi summer in 2020 rife with hacks, rugpulls, and scams, the community is — perhaps rightfully — suspicious of projects that don’t have real-world reputations behind them.

It’s a notion the Premia team rejects.

“There’s been this stain that’s been put on anonymous teams by competing teams that have faces… but plenty of the ones that have been run by people with faces, like FEW, MANY, things like that, have been pretty blatant scams, and the community still accepts all of the people that have faces.”

Ultimately, Anon Powered hopes to enable anonymous developers to have a positive impact in the space.

“People are starting to see that having anonymity or pseudo-anonymity is a benefit […] We want to take this organization to the next level, and continue to build out and provided services and an opportunity to people who want to protect their privacy but still want to contribute to the Ethereum ecosystem and the Ethereum community.”

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