Avalanche (AVAX) Defies Bear Market With Explosive On‑Chain Growth, Messari

Overview

A recent report from crypto market intelligence firm Messari sheds light on Avalanche’s (AVAX) performance during the fourth quarter of 2025. The report illustrates a stark contrast between the declining price of AVAX and the record-breaking on-chain activity that the Avalanche network experienced.

Declining Token Performance

In the fourth quarter of 2025, Avalanche’s native token, AVAX, faced a significant downturn. According to Messari, the token suffered a steep decline of 59.0% quarter-over-quarter and 65.5% year-over-year. This drop saw AVAX’s value decrease from approximately $30.00 at the end of the third quarter to around $12.30 by the end of Q4. The market capitalization of AVAX mirrored this decline, falling 58.3% quarter-over-quarter and 63.9% year-over-year, dropping from $12.7 billion to $5.3 billion. Consequently, Avalanche’s ranking by circulating market cap fell from 14th to 21st place within the broader digital asset landscape.

Despite these declines in valuation, Messari highlighted a notable divergence between the token’s price performance and its network usage. While total fees in US dollars dropped 11.7% quarter-over-quarter, this decline was relatively modest compared to the substantial 59.0% decrease in AVAX’s price. In native terms, however, fees paid on the network saw a meaningful increase, with fees denominated in AVAX rising 24.9% quarter-over-quarter, moving from 105,719 AVAX to 132,016 AVAX. Furthermore, the average daily transactions on the C-Chain rose significantly, jumping 63% to 2.1 million. This surge was notably influenced by a wave of liquidations during a market crash on October 10, 2025, which generated $520,715 in transaction fees—the highest single-day total recorded on Avalanche since February 2024.

Record Activity on Avalanche

Avalanche’s ecosystem demonstrated remarkable growth in Q4 2025. Aggregate usage across the C-Chain and all Avalanche Layer-1 networks experienced an accelerated increase. Average daily transactions rose 4.5% quarter-over-quarter and saw a dramatic surge of 1,162.1% year-over-year, reaching 38.2 million. Additionally, the average daily active addresses climbed 25.1% quarter-over-quarter and an extraordinary 16,360.3% year-over-year, totaling 24.7 million active addresses. The C-Chain alone reached historic levels of activity, with average daily transactions increasing 69.0% quarter-over-quarter and 799.3% year-over-year, marking Q4 2025 as the busiest quarter on record for the chain.

However, staking metrics reflected the pressure from falling prices. The total USD value of staked AVAX decreased 59.9% quarter-over-quarter and 69.1% year-over-year, dropping to $2.3 billion, largely following the token’s price trajectory.

Evolving DeFi Ecosystem

Despite the challenging market conditions, Avalanche’s decentralized finance (DeFi) ecosystem continued to evolve. Messari reported an increase in the DeFi Diversity Score, which measures the distribution of protocols contributing to 90% of total value locked. This score rose 5.9% quarter-over-quarter and 63.6% year-over-year, increasing from 17.0 to 18.0. Total DeFi TVL across Avalanche Layer-1s and the C-Chain witnessed a decline of 41.9% quarter-over-quarter and 3.8% year-over-year, falling from $2.2 billion to $1.3 billion. However, when measured in AVAX rather than in USD, native DeFi TVL rose 34.5% quarter-over-quarter to 97.5 million AVAX, indicating a significant divergence due to the faster decline in AVAX’s price.

One of the most notable areas of growth for Avalanche in Q4 was in real-world assets (RWAs), with RWA TVL jumping 68.6% quarter-over-quarter and 949.3% year-over-year, increasing from $789.8 million at the end of Q3 to $1.33 billion by the end of Q4 2025.

From author

This report illustrates the resilience of Avalanche’s network activity despite the significant price declines of its native token, AVAX. The contrasting metrics highlight an evolving ecosystem that continues to attract users and developers, indicating potential long-term viability and growth.

Impact on the crypto market

• Avalanche’s increasing on-chain activity could attract more users and developers to its ecosystem.
• The divergence between token price and network usage may challenge conventional views on the relationship between price and utility.
• The growth in real-world assets (RWAs) could signify a broader trend of integrating traditional assets into blockchain ecosystems.
• The increase in DeFi Diversity Score suggests a more decentralized and robust DeFi landscape on Avalanche.
• Continued strong network activity could lead to future innovations and partnerships within the Avalanche ecosystem.