Avalanche Q4 2025 Analysis: Record Usage, Institutional Adoption & More

Avalanche experienced a quarter of sharp contrasts in Q4 2025. While AVAX token price dropped 59% from $30 to $12.30, network usage reached all-time highs and real world asset adoption accelerated, according to a recent Messari report.. BlackRock's deployment of $500 million through its BUIDL fund highlighted growing institutional interest, even as the token's market cap fell from $12.7 billion to $5.3 billion.

What Happened to AVAX Price in Q4 2025?

AVAX declined 59% during the quarter, falling from $30 at the end of September to $12.30 by December 31. The circulating market cap dropped 58.3% to $5.3 billion. This price decline pushed AVAX from 14th to 21st place in token rankings by market cap. The selloff came after a period of growth in Q3 and reflected broader market volatility during late 2025.

Despite the steep price drop, the network demonstrated resilience in key metrics. Transaction fees paid in AVAX actually increased 24.9% to 132,016 AVAX, up from 105,719 AVAX in Q3. Total fees measured in USD only fell 11.7%, far less than the 59% price decline would suggest. This divergence shows users continued to actively use the network regardless of token price.

The October 10, 2025 market crash created a spike in activity. Liquidations during that single day generated $520,715 in transaction fees, marking the highest single-day fee revenue since February 2024.

How Did Network Usage Decouple From Price Performance?

Network activity surged across multiple metrics. Average daily transactions on the C-Chain jumped 63% to 2.1 million, setting a new quarterly record. Active addresses increased 14.2% to reach an average of 319,010 daily users. On December 31, daily active addresses peaked at 436,783.

When including all Avalanche L1 chains (formerly called subnets), the numbers grew even more dramatically. Total average daily transactions across the entire ecosystem reached 38.2 million, up 1,162.1% year-over-year. Average daily active addresses hit 24.7 million, representing a 16,360.3% annual increase.

This growth stemmed from continued expansion of dedicated Avalanche L1 networks. The total number of active L1s increased to 75 by year end, up 10.3% from Q3 and 158.6% from the previous year.

Binary Network Dominated Transaction Volume

The Binary Network maintained its position as the dominant L1, processing 3.11 billion transactions during Q4. This represented 92.9% of all L1 transactions, up from 65.9% in Q3. 

Binary's growth came from embedding Web3 applications directly into telecom loyalty programs across Southeast Asia and Africa through its OneWave platform. This strategy provided access to over 385 million monthly active users.

Real World Assets Drive Institutional Adoption

RWA total value locked on Avalanche grew 68.6% during the quarter, rising from $789.8 million to $1.33 billion. This represented a 949.3% increase year-over-year. Several major institutional partnerships drove this expansion:

• BlackRock tokenized $500 million of its BUIDL fund, an onchain money market fund, directly on Avalanche in October. This marked a significant institutional endorsement of the network's infrastructure.

• Fortune 500 fintech FIS partnered with Intain to launch a tokenized loan marketplace on a dedicated Avalanche L1 in November. The platform connects 2,000 U.S. banks to buy, sell, and securitize over $6 billion in loans. FIS tokenized commercial real estate loans and aviation-finance loans during the quarter.

• Progmat, the Japanese digital asset platform backed by MUFG, migrated over $1.1 billion in tokenized securities to an Avalanche L1. The platform serves major financial institutions in Japan's regulated markets.

• S&P Dow Jones partnered with Dinari to create the S&P Digital Markets 50 Index, combining 35 crypto-linked equities and 15 digital assets into a tokenized index. The benchmark maintains a fixed 70% equity and 30% crypto allocation.

These institutional deployments demonstrated Avalanche's appeal for regulated financial products. The network's sub-second finality and EVM compatibility met requirements for traditional finance institutions entering blockchain markets.

DeFi Ecosystem Shows Sticky Liquidity

Total DeFi TVL across Avalanche fell 41.9% in USD terms to $1.3 billion. However, DeFi TVL measured in AVAX actually rose 34.5% to 97.5 million tokens. This apparent contradiction reveals what analysts call sticky liquidity.

Because AVAX price fell 59% while USD TVL only dropped 44.9%, the ratio of AVAX-denominated value increased mathematically. Users maintained their stablecoin and non-native asset positions rather than bridging funds to other networks. This behavior indicates confidence in the protocol infrastructure even during price declines.

The top three protocols controlled 72% of C-Chain TVL:

• Aave held 47.3% market share with $601 million in TVL
• Benqi captured $210.9 million despite a 39.8% quarterly decline
• Blackhole maintained $102.3 million with an 8.1% market share

Pharaoh Exchange stood out as the quarter's top performer. It was the only major protocol showing positive growth both quarterly (2.3%) and annually (66.9%). The platform hit an all-time high in daily fees on November 21, generating $284,210.

Stablecoin Market Remains Stable

The stablecoin market cap stayed nearly flat at $1.74 billion. USDT overtook USDC to become the dominant stablecoin with 42.3% market share ($736.6 million). USDT grew 19.7% during the quarter while USDC fell 16.3% to $638.5 million.

Avalanche L1 Expansion Continues

Four new L1 networks launched and produced blocks during Q4:

• Titan Content built an L1 for its K-pop fan engagement app 2GATHR. The network issues verified digital collectibles and coordinates artist-fan interactions.

• Blaze created a decentralized content streaming L1 to redistribute revenue from centralized platforms directly to creators.

• Lylty, developed by FanHub, records sports fan engagement data onchain to enable transparent loyalty tracking.

• Orange Web3 focuses on AI-native creators, providing infrastructure to deploy AI-driven applications.

The FIFA Avalanche L1 had its strongest quarter since launch, driven by anticipation for the 2026 World Cup. Transactions increased 16.2% to 272,297 as users converted World Cup "Right to Buy" tickets into actual match tickets. Daily active wallets surged 162% to 3,362 addresses.

Conclusion

Avalanche Q4 2025 demonstrated that network fundamentals can diverge sharply from token price performance. While AVAX fell 59% to $12.30, the network processed record transaction volumes, expanded to 75 active L1 chains, and attracted $500 million in institutional capital through BlackRock's BUIDL deployment. 

The quarter established Avalanche's infrastructure for regulated financial products and consumer applications, with users maintaining $1.3 billion in DeFi TVL and paying increased fees despite market volatility.

Resources

1. Avalanche on X: Posts (October, 2025 - December, 2025)

2. Avalanche blog: Recent updates

3. Messari report: State of Avalanche Q4 2025

4. Blog article by Ava Cloud: Progmat Migrates over $1B+ in Tokenized Securities with AvaCloud to Power Japan’s Digital Asset Future