The Avalanche blockchain received a welcome booster this last week as the surging price of AVAX brought traders to its DeFi dapps. The top 5 dapps on Avalanche all recorded significant increases in unique active users while pushing the total value locked on the network to $2.3 billion.
Stepping out amidst the rising DeFi stars on Avalanche are the Pangolin Exchange, which we have covered many times, and the new entrant – Trader Joe. At the time of writing Trader Joe has attracted 19,780 unique active wallets in the last 7 days. Those wallets generated over $267 million in volume. Which is just a little short of the Pangolin Exchange’s totals within the same time frame. Impressive for a dapp that’s only been alive since the end of June, while Pangolin has been active since early February.
Additionally, the total value locked in the smart contracts of Trader Joe has now climbed to over $544 million. Surpassing that of the leading DeFi dapp on Avalanche Pangolin Exchange by over $200 million. According to data from DeFiLama.
What’s happening?
One correlation that can be spotted immediately is the rising token price of the native Avalanche token AVAX. In the same time frame, we observe surges of activity through the dapps. In the last 30 days, the price of AVAX is up over 200%, and up 14.4% in the last 7 days.
This is important for several reasons. Firstly, the rising token price can bring traders to the table as their portfolio value has perhaps increased. Secondly, this can increase their purchasing power and additionally making staking and vesting options more valuable.
What is Trader Joe?
Trader Joe is a self-proclaimed one-stop trading platform on the Avalanche blockchain. It launched its decentralized exchange on June 29th and has plans to offer DeFi lending and leveraged trading at a later date. The product is community-driven through its JOE governance token and allocates fees collected from liquidation and swaps back to the users via staking JOE to get xJOE rewards. Overall, the platform offers a slick and friendly user experience that appears to be attracting traders.
Moreover, and as with other surges we observe around DeFi dapps. The reason many traders end up on these platforms is introductory offers based around product launches, yields, and staking offers. In this case, there are several stimuli but the launching of a new farm offering miMATIC (MAI) / USDC.e at 1x and over 39% APR announced via Twitter appeared to drive interest. The reason for the perhaps odd-looking token tickers is the fact the tokens are wrapped for the Avalanche network – fundamentally they are MATIC and USDC. Two of the most held ERC-20 tokens can be easily ported over to Avalanche using a bridge. Additionally, the native JOE token was listed on three exchanges, allowing people to potentially invest and stake more easily.
Also, the introduction of several JOE farms with extremely juicy APRs is sure to have helped push those transactions and user numbers up. For example, farming JOE alongside USDT.e has an APR of 207% currently.
A medium blog update about the growing Trader Joe platform shed some more light on the dapp’s achievements in a short space of time. Claiming that TVL had hit $675 million and that over $100 million of xJOE was now staked, collecting daily fees of $100k rewarded to stakers. Additionally, excitement seems to be built around a new offer called Banker Joe which will allow lending options to users. Essentially allowing them to lend their crypto assets for a percentage return.
Avalanche is coming
The Avalanche blockchain is one of the first smart contract platforms able to offer a combination of confirming transactions in under one second, supporting the Ethereum development toolkit, and enabling independent validators to participate as full block producers. Moreover, the Avalanche protocol is attempting to cherry-pick the best aspects of current distributed LEDGER technology and place it within a tidy frame. By implementing the innovations of Ethereum and the EVM, and respecting age-old systems while changing the core mechanics to achieve faster, lighter, and cheaper running costs. Enabling dapps like Trader Joe and Pangolin Exchange to flourish.
Newsletter The above does not constitute investment advice. The information given here is purely for informational purposes only. Please exercise due diligence and do your research. The writer holds positions in ETH, BTC, ADA, MATIC, SAFEMOON, HEX, LINK, GRT, CRO, OMI, USDT, SOL, SHIBA INU, AVASTR, RAY, BOSON, AND OCEAN.
