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Avalanche's Downturn: Bearish Sentiment in Tech Faces Off Against $1B Treasury and ETF Optimism

Avalanche's Downturn: Bearish Sentiment in Tech Faces Off Against $1B Treasury and ETF Optimism

Bitget-RWA2025/09/26 13:32
By:Coin World

- Avalanche (AVAX) fell 7.1% to $34 as technical indicators worsened, with MFI below 50 and bearish Supertrend signals. - Institutional moves include a $1B treasury plan by Avalanche Foundation and ETF proposals from VanEck/Grayscale, aiming to boost demand. - Ecosystem growth shows 493% QoQ transaction surge and $2.23B TVL, but price projections remain split between $55 rebound or $17.33 drop risks. - SEC's late-September ETF decision could trigger massive liquidity shifts, mirroring Bitcoin's ETF-driven

Avalanche's Downturn: Bearish Sentiment in Tech Faces Off Against $1B Treasury and ETF Optimism image 0

Avalanche (AVAX) dropped by 7.1% to $34 in the most recent CoinDesk 20 update, weighing down the broader crypto index as market sentiment shifted due to conflicting institutional and technical signals. The token’s decline came after it retreated from a 30-day peak of $36.50, with analysts pointing to profit-taking following a 30% surge over the past two months. AVAX now has a market cap of $14.6 billion, placing it 13th on CoinMarketCap, and its 24-hour trading volume hit $2.7 billion, indicating ongoing liquidity despite the recent downturn Avalanche (AVAX) Snapshot – Price Dynamics: InsideBitcoins [ 1 ].

The sell-off was accompanied by a significant breakdown in technical signals. The Money Flow Index (MFI) for

fell under the neutral 50.00 mark, indicating weaker buying and stronger selling pressure. On the daily chart, the Supertrend indicator turned red above the price, confirming a bearish trend. The Moving Average Convergence Divergence (MACD) also stayed negative, pointing to continued bearish sentiment Will AVAX Price Drop Below $20 After Losing Key … [ 3 ]. Key support levels are now at $30 and $26, with a further drop possibly testing the $22 psychological threshold Avalanche (AVAX) Snapshot – Price Dynamics: InsideBitcoins [ 1 ].

Institutional activity has added further complexity. The

Foundation’s $1 billion treasury program, launched in early September, is designed to boost AVAX demand through discounted token sales to two U.S.-based crypto treasury firms. One of these, managed by Hivemind Capital and advised by Anthony Scaramucci, raised $550 million via a Nasdaq-listed vehicle, AVAX One Avalanche Defies Crypto Market Dump With 10% Gains [ 2 ]. At the same time, VanEck and Grayscale have moved forward with AVAX ETF proposals, with Grayscale aiming to convert its Avalanche Trust into a spot ETF. Analysts predict a 90% chance of major AVAX ETFs being approved by late 2025, though regulatory holdups could cause price swings Avalanche (AVAX) Snapshot – Price Dynamics: InsideBitcoins [ 1 ].

Growth across the Avalanche ecosystem continues to fuel optimism. The April Octane upgrade cut C-Chain fees by 98%, driving daily transactions to 1.4 million in Q2—a 493% quarter-over-quarter jump—and pushing total value locked (TVL) to $2.23 billion by late August. Stablecoin market cap on Avalanche also climbed 81% in 30 days to $2.16 billion, spurred by protocols like Aave Avalanche Defies Crypto Market Dump With 10% Gains [ 2 ]. Coin Bureau noted a record $1 billion in decentralized exchange (DEX) volume in early September, marking the highest daily trading activity for Avalanche in 18 months Avalanche (AVAX) Snapshot – Price Dynamics: InsideBitcoins [ 1 ].

Price outlooks remain mixed. A rounded bottom pattern on the daily chart hints at a possible 61% rebound to $55 or even a 511% rally to $212, provided buying pressure holds above the $36 resistance Avalanche Defies Crypto Market Dump With 10% Gains [ 2 ]. On the other hand, bearish projections warn of a potential slide to $17.33 if the $30 support fails, citing overbought RSI levels and previous corrections after similar technical patterns Will AVAX Price Drop Below $20 After Losing Key … [ 3 ].

The SEC’s upcoming decision on AVAX ETF applications, expected by late September, will be crucial. Approval could unlock billions in institutional capital, similar to the impact seen with

and Ethereum’s ETF launches. However, delays or rejections could increase short-term volatility, especially as token unlocks and profit-taking intensify Avalanche (AVAX) Snapshot – Price Dynamics: InsideBitcoins [ 1 ]. With subnet activity on Avalanche rising and enterprise use cases expanding—including Toyota’s mobility finance pilots and FIFA’s NFT ticketing initiatives—the long-term outlook depends on maintaining momentum above $35 Avalanche (AVAX) Snapshot – Price Dynamics: InsideBitcoins [ 1 ].

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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