Avalanche Grows as Blockchain Choice for Governments Despite Token Struggles
Avalanche sees substantial government and institutional interest, yet its token value remains significantly lower than its peak.
Avalanche is becoming the blockchain of choice for both government entities and institutional investors, although the value of its native token remains substantially below historic highs.
In the latest quarter, Wyoming’s Stable Token Commission launched the Frontier Stable Token (FRNT), a government-endorsed stablecoin, on Avalanche along with six other public blockchains, indicating a notable rise in the adoption of blockchain technology by governmental bodies.
FRNT was introduced as a fully collateralized stablecoin, secured by US dollars and US Treasury bills, with a 102% reserve requirement.
Avalanche has also attracted interest from conventional financial sectors. SkyBridge Capital, led by Anthony Scaramucci, is set to tokenize $300 million worth of hedge fund assets on the network.
Crypto analytics firm Nansen describes this expansion as “quietly turning TradFi and gov tech into onchain reality,” adding, “DeFi just got institutional”.
Avalanche Adoption Data
Source: Nansen
At the close of Q3, Avalanche ranked as the third-largest blockchain by the amount of tokenized US Treasurys on-chain, amounting to $638 million, trailing only BNB Chain and Ethereum.
Tokenizing US Treasurys enhances investor access and trading options, contributing to the expanding real-world asset tokenization sector.
Top Blockchains Analysis
Top blockchains by tokenized US Treasurys. Source: RWA.xyz
In addition, Avalanche’s on-chain metrics indicate a vibrant user base, averaging over a million transactions daily, with a peak of 51.6 million transactions during the quarter, per Nansen data.
On-Chain Activity
Source: Nansen
Despite these developments, Avalanche’s native utility token, AVAX, has seen an 86% drop from its all-time high of $146, recorded on November 21, 2021. Currently, AVAX trades at $19.66, reflecting a 33% decrease in the past month, coinciding with a record $19 billion liquidation event triggered by threats of 100% import tariffs on Chinese goods from former US President Donald Trump.
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