Axie Infinity price is currently 97% down from the $166 peak it reached during the 2021 Metaverse rally. Crypto expert Ibrahim Ajibade examines the possibility of recovery of the popular metaverse altcoin project through on-chain data.
Axie Infinity strives to save the community
The popular metaverse altcoin project Axie Infinity (AXS) has been left out of the top 50 cryptocurrencies. At the height of the Metaverse rally in 2021, Axie Infinity had a market cap of $9.6 billion. However, in the current situation, its value has decreased by more than 93% to $630 million. AXS price hit a low of $4.95 around August 20.
However, on-chain data shows that instead of panic, the Axie Infinity network is witnessing an optimistic response. According to Santiment data, AXS Daily Active Addresses have been showing a steady increase since August 21. As of August 20, only 176 wallet addresses had interacted on the AXS network. However, since then, AXS network activity has gradually increased. Thus, it has exceeded 200 addresses on all but one trading day since August 31.
Axie Infinity Daily Active Addresses. Source: SantimentAs you can see above, there has been a steady increase in altcoin Active Addresses over the last three weeks. This shows that individual investors are taking action to avoid terminal losses. Increased network activity typically means increased network demand for the underlying asset. Unsurprisingly, the increase in active network addresses helped AXS maintain the $4.50 support level. Thus, it stopped the panic selling in late August.
Bullish traders did not give up their recovery hopes!
According to exchange order books, many strategic traders have set up a fairly high sell wall to mitigate the risk of altcoin price dropping to zero. As you can see below, crypto traders have placed active orders to buy 1.25 million AXS tokens at around current prices. Meanwhile, bearish traders only put 1.14 million AXS on sale.
Axie Infinity Exchange Order Books. September 2023. Source: IntoTheBlockThe Exchange On-Chain Market Depth chart shows the volume of active orders placed by AXS traders on well-known crypto exchanges. The chart above reveals that despite the prevailing bearish sentiment, current market demand for AXS still exceeds supply at 110.00 coins. This is a vital sign that the AXS token still has enough demand to absorb the impending selling pressure and prevent the price of Axie Infinity from falling to zero.
Altcoin price prediction: Consolidation in the $5 range
The bulls continue their last-ditch recovery efforts. However, AXS will face serious difficulties reclaiming the $5 zone. This is clearly illustrated by the Take/Loss Around Price data, which summarizes the purchase price distribution of current AXS holders. The data highlights that 279 investors purchased 1.05 million AXS tokens at a maximum price of $4.70. If there is no significant change in market sentiment, it is possible for them to sell early. It is possible that this will trigger another decline.
However, if the bulls break through this resistance zone, it is possible that they could save the altcoin price from approaching zero. In that case, there is a chance that they will consolidate around $5 instead.
Axie Infinity IOMAP data. August 2023 | Source: IntoTheBlockStill, if the unsettling sentiment surrounding the metaverse intensifies, the bears are likely to trigger a massive plunge towards zero, potentially. However, 283 addresses have purchased 343,580 AXS at a minimum price of $4.37. And if they choose to HODL, the altcoin price is likely to rebound. However, if this support level gives way, AXS price may start to approach zero.
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