Avalanche has seen its native token AVAX rise rapidly over the past 30 days, making its way into the top 10 tokens by market capitalization. This rally didn’t exactly come out of the blue, as activity on the Avalanche network started to pick up again. During this period, open interest also rose rapidly, eventually reaching a new record high.
Avalanche open interest rises to $413 million
Tuesday has the Avalanche open interest rose to its highest level since launch, following AVAX’s rise to $40. Open interest reached $413 million on December 12, after rising continuously for over a month. The increase occurred in tandem with the price increase and has peaked almost every day in December.
The increase began in October after trailing by about $70 million for most of a month. However, in November there was a noticeable change in open interest as traders started taking their positions in the digital asset.
Source: Coinglass
Between November and December, AVAX’s open interest increased by more than 400%. On Tuesday alone, open interest grew another 19%, bringing Avalanche’s total open interest across all exchanges to 11.43 million AVAX.
73% of the total open interest actually comes from just two exchanges; Binance and ByBit. According to Coinglass data, Binance accounts for 44% of the total OI with $184 million (4.54 million AVAX), while ByBit accounts for 28.8% of the OI with $119.67 million (2.95 million AVAX) . BingX, OKX and Bitget make up the rest of the top 5 with $50.37 million, $43.7 million and $41.8 million respectively.
Token price retraces to $36 | Source: AVAXUSD on Tradingview.com
OI increase sending AVAX price to $100?
Although Avalanche’s open interest has risen to a new all-time high, the AVAX price still has a long way to go before it reaches its all-time high of $146. Nevertheless, the rise in open interest is still incredibly bullish for the price.
As proven by historical performance, AVAX’s price has often risen when open interest has risen. This was the case between 2021 and 2022, when the altcoin’s price rose above $100 before finally crashing in 2022.
If Avalanche’s open interest continues to rise from here, AVAX is expected to follow suit. A breakout of the OI above $500 million will undoubtedly see the altcoin reach the coveted $50 level again. However, $100 still seems far away and will likely be reached sometime in 2024.
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