Will AVAX Outperform Bitcoin in 2023?

Bitcoin () is the undisputed king of cryptocurrencies, but some are challenging its . One of them is , a fast and scalable that aims to provide a better user experience and lower fees than Bitcoin.

In this article, we will explore the reasons why AVAX could beat Bitcoin in terms of and adoption by 2023. We will also look at the and challenges that AVAX faces in its quest to become a top cryptocurrency.

AVAX Has a Strong Technical Setup

One of the main factors that could drive higher is its bullish technical setup. According to Cointelegraph, AVAX has been forming a falling wedge pattern since May 2022 and has now entered the stage of this pattern.

A falling wedge is a bullish reversal pattern that indicates a potential uptrend after a downtrend. The pattern is formed by two converging, descending trendlines that act as and for the price. The breakout occurs when the price breaks above the upper trendline and confirms the reversal.

As a rule of thumb, the price can rise as high as the distance between the upper and lower trendlines at the start of the pattern. In AVAX's case, this would bring its breakout target to around $34, a 115% increase from its current price of around $16.

AVAX Has a Strong Fundamental Setup

Another factor that could boost AVAX price is its strong fundamental setup. AVAX is backed by , a leading blockchain company that has partnered with Web Services (AWS) to provide blockchain solutions for enterprises and governments.

This partnership will make it easier for developers to run an node through the AWS and create subnets on the . Subnets are custom blockchains that can have their own , rules, and assets. This feature allows for greater , scalability, and customization of blockchain applications.

The partnership with AWS will also increase Avalanche's exposure and credibility among potential and investors, as AWS is one of the largest providers in the . This could lead to more adoption and demand for AVAX , which are used to pay for transactions and smart contracts on the Avalanche network.

AVAX Could Benefit from a Favorable Macro Environment

A third factor that could support AVAX price is a favorable macro environment for riskier assets, which may benefit the in general. According to Bloomberg, economists are expecting a drop in the U.S. rate in December 2022, after reaching a record high of 6.8% in November.

A lower inflation rate could ease the pressure on the to raise interest rates and tighten , which could hurt the and other risk-on assets. A more dovish could also leave investors with more to invest in alternative assets such as cryptocurrencies.

JPMorgan & Chase has outlined a plan for investors on how to react to different inflation scenarios on Jan. 12, when the next CPI report will be released. The bank sees a 20% probability of the S&P 500 index rising by 3–3.5% if the inflation figure comes in at 6.4%. The index could rise 1.5–2% if the inflation reading comes inside the 6.4–6.5% range, a scenario with a 65% possibility.

Thus, AVAX could rise alongside the U.S. benchmark index on a lowered inflation reading, with a rally continuing at least until the Fed's meeting on Jan. 31.

AVAX Faces Some Downside Risks

While AVAX has a lot of potential to outperform Bitcoin in 2023, it also faces some downside risks that could derail its bullish momentum. One of them is the high volatility and uncertainty in the , which could affect AVAX's price negatively.

For example, on Jan. 8, AVAX plunged by 15% in a single day, following a market-wide sell-off triggered by the Luna (LUNA) . LUNA is another blockchain platform that supports stablecoins and decentralized applications. LUNA's price dropped by more than 50% after its network suffered from congestion and instability issues.

AVAX is connected to LUNA and another project called Axie Infinity (AXS) through the Luna Foundation Guard (LFG), a non-profit organization that aims to support blockchain and adoption. The LFG had bought nearly 2 million AVAX coins worth $100 million to hold in reserve as backstop assets for LUNA and AXS, according to The Motley Fool.

This means that if LUNA or AXS face any liquidity or solvency issues, the LFG could sell some of its AVAX holdings to cover the losses. This could create selling pressure on AVAX and lower its price. Therefore, AVAX investors should keep an eye on the developments of LUNA and AXS, as they could affect AVAX's performance.

AVAX Has a Bright Future Ahead

Despite the risks and challenges, AVAX has a bright future ahead as one of the most innovative and promising blockchain platforms in the crypto space. AVAX has a strong technical and fundamental setup that could propel its price to new highs in 2023.

AVAX also has a loyal and growing community of users and developers who support its vision and mission. AVAX has over 1.5 million active , over 500 validators, and over 300 decentralized applications running on its network, according to Cryptopolitan.

AVAX could also benefit from a favorable macro environment that could boost the demand and adoption of cryptocurrencies in general. If Bitcoin continues to lead the market higher, AVAX could follow suit and outperform it with its superior features and advantages.

Therefore, AVAX could be a great for those who believe in its potential and are willing to take some risks. AVAX could beat Bitcoin in 2023 and reach $100,000 or even higher by 2025.

The Bottom Line

In this article, we have explored the reasons why AVAX could beat Bitcoin in 2023 and reach $100,000 or more by 2025. We have also looked at the risks and challenges that AVAX faces in its quest to become a top cryptocurrency.

We hope you have enjoyed reading this article and learned something new about AVAX and Bitcoin. If you have any questions or comments, please feel free to share them below. We would love to hear from you!

Emily Lee

By Emily Lee

Hi, I’m Emily Lee, a writer at avangernews.com. I love to write about technology, culture, and entertainment. I’m always curious about new trends and innovations, and I enjoy sharing my insights and opinions with my readers. I have a degree in journalism from the University of California, Berkeley, and I have worked as a freelance writer for various publications before joining avangernews.com. When I’m not writing, I like to read books, watch movies, and play video games. You can follow me on Twitter @emily_lee or email me at emily@avangernews.com.

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