A recently launched token standard allowing arbitrary data to be inscribed on the blockchain, like Bitcoin Ordinals, is driving the surge as traders pile into ASC-20 tokens.
Ordinals fever is spreading beyond Bitcoin, with Avalanche becoming the latest chain to develop its own token standard enabling arbitrary information to be inscribed onto the blockchain.
Dubbed ASC-20s (like Bitcoin’s BRC-20s), the launch of these tokens has led to a spike in trading activity, with transactions surging by more than 2,000% in less than a week.
Avalanche, an Ethereum-compatible Layer 1 network accustomed to an average daily transaction count between 150,000 and 250,000, saw volume spike to a peak of 6.36 million transactions on Nov 21st, only days after ASC-20s were set loose.
The resurgence of activity is welcome news for a blockchain that took some hits in Q3. Not only did the development team behind the project, Ava Labs, downsize their team by 12%, but on-chain activity and users declined during the first three quarters of the year.
Avalanche also struggled to maintain its market share during the protracted bear market, witnessing its total value locked (TVL) plummet from $11.5B in December 2021 to $642M at the time of writing.
The hype is likely unsustainable – near vertical numbers are usually a cause for caution – but ASC-20s are definitely sparking newfound interest in the network.
Metrics across the board are beginning to trend upward. Fees generated by ASC-20s have been slightly slower to catch up with demand from users, although they spiked on Nov 21st, hitting an all-time high of $837,000, as per DefiLlama.
AVAX, the network’s native token, has also rallied sharply, nearly doubling in the past thirty days.
Notably, and similar to Ordinals when they first appeared, there are currently no marketplaces to trade ASC-20s, nor any indexers to analyze the actual number of users minting these tokens.
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