Avalanche (AVAX) Continues Bullish Trend Amid Rising DeFi Trading Volume

Avalanche (AVAX) price showed a strong rebound early in the week and retested last week's high. Despite overall market unease, it has maintained a bullish trend, drawing investor attention.

According to CoinRepublic, on the morning of the 24th AVAX rose to 35.76 dollars, once again confirming the weekly high. This represented roughly a 20% rebound from the previous day's low. According to CoinGlass, net inflows in the spot market over the past 24 hours amounted to 8 million dollars, suggesting a weakening of selling pressure. In the process, about 2.8 million dollars worth of short positions were liquidated, which was part of liquidity fluctuations following the 9.2 million dollars long liquidation that occurred the previous day.

Avalanche's strength is linked to an increase in market share. AVAX's share, which was around 0.26% in early September, has risen to 0.38%. The increase in DeFi trading volume supported this. According to DeFiLlama's tally, the Avalanche network's weekly DEX volume reached 4.2 billion dollars, the highest in the past three years. This is seen as similar to flows during the 2021 bull market.

Expanded institutional demand has also acted as a positive factor. Anthony Scaramucci, founder of SkyBridge Capital, recently said he plans to create a digital asset treasury based on Avalanche. He added that multiple companies are establishing tokenized funds using the Avalanche network.

Analysts say that institutional participation, DeFi network growth, and a recovery in market confidence coming together have initiated a liquidity rotation effect for AVAX. Currently, AVAX is trading about 65% below its all-time high, so some view it as still undervalued. It remains to be seen whether the recent strength will be a short-term rebound or the start of a new bull market.