Ava Labs’ Vryx Scaling Solution Causes AVAX to Spike by 10% — Will Avalanche Continue Rising?
Avalanche is on the rise, but is still in a downtrend overall. Will it fall further?
Key Takeaways
- AVAX surged 10% after the Vryx scaling solution announcement.
- Vryx aims for 100,000 transactions per second on Avalanche.
- AVAX’s price fluctuates, with the potential for a larger correction.
After Ava Labs announced the Vryx scaling solution, Avalanche’s AVAX token rose 10% to nearly $37 in 24 hours. Reflecting the optimism generated by this news, AVAX outperformed other major cryptocurrencies, such as Bitcoin (BTC), Ethereum (ETH), and Solana (SOL).
At the time of writing (January 29 2024), it was worth a little below $35. The recent rise could have signalled the start of a new uptrend.
Why is the Vryx Scaling Solution Important?
Vryx aims to allow the Avalanche network to handle up to 100,000 transactions per second using something called Decoupled State Machine Replication (DSMR). This allows for more efficient transaction processing by distributing and organizing them before validation, thus enhancing speed and volume.
This contrasts with traditional blockchains like Bitcoin, which sequentially execute and replicate valid transactions in each block. Vryx’s approach divides the transaction process into separate segments. This, at least in theory, improves transaction speed and protects against cyber attacks.
Vryx will initially be tested on the HyperSDK testnet before being implemented in other Avalanche Virtual Machines. Patrick O’Grady from Ava Labs claimed that Vryx combined the benefits of DSMR pipelining with the robustness of traditional State Machine Replication.
AVAX Price Analysis
As AVAX broke above its bear market descending trendline on November 1, it surged by 470%. It came from a low of $9 on October 19 to a high of $50 on December 24.
After that, it went down, a corrected move anticipated in some of our previous AVAX analyses. This projection still stands, but today’s spike could overrule this. If it rises above $41, another high would be more likely.
However, the price is now interacting with the local descending resistance anchored at the December high. It might get rejected, further pushing the price downward.
If this was the first uptrend in a lasting bull phase for Avalanche, the first bull market correction could happen now. The next strong zone to offer support would be around $20.
Once the correction is out of the way, a new uptrend will start, leading the price of AVAX to match all-time high and, ultimately, surpass it.
Disclaimers
Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.
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