Avalanche stablecoins up 70% to $2.5B, AVAX demand lacks DeFi deployment

Avalanche noticed a major surge in stablecoin provide over the previous yr, however the onchain deployment of this capital factors to passive investor habits, which can be limiting demand for the community’s utility token.

The stablecoin provide on the Avalanche community rose by over 70% over the previous yr, from $1.5 billion in March 2024, to over $2.5 billion as of March 31, 2025, in accordance to Avalanche’s X pos

Stablecoins are the primary bridge between the fiat and crypto world and growing stablecoin provide is commonly seen as a sign for incoming shopping for stress and rising investor urge for food.

However, Avalanche’s (AVAX) token has been in a downtrend, dropping practically 60% over the previous yr to commerce above $19 as of 12:31 pm UTC, regardless of the $1 billion enhance in stablecoin provide, Cointelegraph Markets Pro knowledge exhibits.

“The apparent contradiction between surging stablecoin value on Avalanche and AVAX’s significant price decline likely stems from how that stablecoin liquidity is being held,” in accordance to Juan Pellicer, senior analysis analyst at IntoTheBlock crypto intelligence platform.

Related: Bitcoin can hit $250K in 2025 if Fed shifts to QE: Arthur Hayes

A “substantial portion” of those inflows consists of bridged Tether (USDT), the analysis analyst informed Cointelegraph, including:

“This seems as inactive treasury holdings rather than capital actively deployed within Avalanche’s DeFi ecosystem (at least for the time being). If these stablecoins aren’t being used in lending, swapping, or other DeFi activities that would typically drive demand for AVAX (for gas, collateral, etc.), their presence alone wouldn’t necessarily boost the AVAX price”

The AVAX token’s downtrend comes throughout a wider crypto market correction, as investor sentiment is pressured by international uncertainty forward of US President Donald Trump’s reciprocal import tariff announcement on April 2, a measure aimed toward decreasing the nation’s estimated commerce deficit of $1.2 trillion.

Related: Michael Saylor’s Strategy buys Bitcoin dip with $1.9B buy

70% likelihood for crypto market to backside by June: Nansen analysts

Nansen analysts predict a 70% likelihood that the crypto market will backside within the subsequent two months main into June as the continuing tariff-related negotiations progress and investor considerations are alleviated.

“Once the toughest part of the negotiation is behind us, we see a cleaner opportunity for crypto and risk assets to finally mark a bottom,” Aurelie Barthere, principal analysis analyst on the Nansen crypto intelligence platform, informed Cointelegraph.

Both conventional and cryptocurrency markets proceed to lack upside momentum forward of the US tariff announcement.

“For the main US equity indexes and for BTC, the respective price charts failed to resurface above their 200-day moving averages significantly, while lower-lookback price moving averages are falling,” wrote Nansen in an April 1 analysis report. 

Magazine: Bitcoin ATH prior to anticipated? XRP could drop 40%, and extra: Hodler’s Digest, March 23 – 29