Avalanche is one of the best performing tokens ahead of the new week, racking up 11.67% in gains over the last seven days alongside Bitcoin and the premier altcoin Ether.
The network’s native token is enjoying an impressive rally despite a recent flash loan exploit on an Avalanche-based lending protocol and false allegations meant to paint Ava Labs in a bad light. Its decentralized finance (DeFi) ecosystem and on-chain metrics like daily transactions don’t particularly flash signals of a healthy ecosystem. Nonetheless, the AVAX token has sustained positive momentum since it slid below $18 last Wednesday.
Optimistic yet for a run-up to new mid-August highs?
The 7-day trading chart for AVAX shows that the token has registered 16.46% gains during this period. The recent uptrend has been aided by the network’s developments and partnerships. Building up to the boost, the Avalanche ecosystem has completed several milestones thus far n September.
AVAX/USD trading chart
Avalanche announced on Saturday (Sept 10) the listing of its AVAX token on the Japanese subsidiary of the leading exchange FTX. FTX Japan now allows its users to trade AVAX (against JPY and USD pairs), adding to the token’s exposure on the global stage. Last Tuesday (Sept 6), data visualization platform Bubblemap revealed a partnership with Avalanche to help the latter deliver a faster and optimized Web3 experience.
While these developments may inspire some confidence in an optimistic outlook, its on-chain metrics indicate that the altcoin lacks the strength to motivate an uptrend towards mid-August highs. Besides, the AVAX social volume is declining as interest in Avalanche’s protocols wanes.
Market analysts have additionally observed exhaustion in the price bounce that saw the altcoin flip immediate resistance at $20 towards the end of last week. However, AVAX still faces a risk of a retracement from the current levels, which could see it nosedive if sellers displace buyers from the driving seat.
Nereus Finance flash loan exploit update
Lending protocol Nereus Finance last Wednesday (Sept 7) suffered a smart contract exploit that saw the attacker(s) get away with $371k worth of USDC. They targeted a vulnerability in the Avalanche-based protocol to manipulate the AVAX/USDC Trader Joe LP NXUSD market. The exploit was first identified by blockchain cybersecurity firm CertiK and late confirmed by Nereus Finance.
A detailed post-mortem issued by the team revealed that by manipulating the AVAX/USDC Trader Joe LP pool price for a single block, the exploiter(s) was able to mint 998,000 NXUSD against collateral worth $508,000. After exchanging this capital for various assets through multiple liquidity pools, they were able to net a profit of $371,406, having paid back the flash loan. Nereus Finance reported that it identified the issues and responded swiftly by seeking the advice of security professionals, creating a mitigation strategy, and informing law authorities.
The team also stopped the exploited JLP market and liquidated it. Nereus Finance used NXUSD from its treasury to pay off the bad debt it was left saddled with due to the creation of $500,000 of NXUSD. The incident resulted from a missed step in the price calculation, which created the opening, to begin with. Despite this vulnerability, the loan and borrowing mechanism was not affected, according to the team. Nereus Finance is tracing the exploiter but is offering a 20% white hat reward (no questions asked) for the return of the funds. To prevent another exploit incident in the future, the team said it will modify its audit and security policies.
Ethereum Core dev prevented a $24 billion market cap erosion on Avalanche
In a separate incident, Ethereum developer Péter Szilágyi last weekend revealed that sometime towards the end of March, he helped patch a vulnerability on the Avalanche blockchain that would have effectively washed away $24 billion in market cap at the time. In a report shared on GitHub, the developer explained how his interest in how the Avalanche network led him to discover a critical bug around its packet handling on Mar 29. Szilágyi also stated that he informed the Avalanche team of the vulnerability. It was fixed that very day, and the patch deployed as part of the avalanchego v1.7.9 upgrade released the next day.
To learn more about Avalanche check out our Investing in Avalanche guide.
The post Market Update: Avalanche (AVAX) Price Up 16% in One Week appeared first on Securities.io.
