Is Avalanche (AVAX) a Good Investment After a 94% Drop?

Avalanche (CRYPTO:AVAX) has lost approximately 93.6% of its value since peaking at $145 on November 21, 2021. The decline has continued, with the AVAX price at $9.26 as of October 22, 2026. It has dropped 4.5% over the past 24 hours, 14.2% over the last two weeks, and 15.6% in the past month.

In the last month, AVAX has fluctuated between a high of $12 on September 29 and a low of $9.25 on October 18, trading only a cent above that low. This downward trend persisted even after the Dubai International Financial Centre (DIFC) Courts began recording court orders on Avalanche on October 14, highlighting the network’s government initiatives.

So, does a 94% decline indicate that AVAX is now a bargain, or is it a red flag?

Avalanche Needs to Surpass Solana to Reach Its Previous Peak

Market cap is calculated by multiplying the token price by the number of coins in circulation. AVAX’s market cap is approximately $4.11 billion, ranking it 28th overall, behind Litecoin (CRYPTO:LTC) at $4.62 billion and ahead of Hedera (CRYPTO:HBAR) at $3.56 billion.

If AVAX returned to its $145 peak, the tokens now in circulation would be worth around $64.3 billion. This would place Avalanche ahead of Solana (CRYPTO:SOL), often considered its closest competitor, which has a market cap of $61.6 billion and ranks seventh.

The challenge of reclaiming that market cap is magnified by AVAX’s growing supply. Approximately 443.9 million AVAX tokens are in circulation, out of a total supply of 470.6 million and a maximum supply of 720 million. The total supply includes all coins created to date, while the maximum supply reflects the ultimate cap. With around 249 million more AVAX tokens still to be issued, any new coins dilute existing holders’ shares.

This dilution means a return to the $145 price point would value Avalanche significantly higher than it did in November 2021, since more tokens are now circulating. The fully diluted market cap—which assumes all tokens will be traded—stands at about $4.36 billion.

Dubai’s Courts Use Avalanche, but Court Orders Bring In Little in Fees

The DIFC Courts handle commercial disputes within the Dubai International Financial Centre. Every order now receives a cryptographic fingerprint—a short code generated from the document—which the C-Chain, Avalanche’s main blockchain, records. Avalanche also supports the UAE PASS Digital Vault, which has served over 12 million users as of September.

However, any initial price increase from this news quickly diminished. AVAX traded at $10 on October 15, marking a 36.7% rise over the previous 30 days, according to our October 16 coverage, but has since fallen 7.4%. Court paperwork generates minimal fees, giving investors little incentive to hold the token. Furthermore, the DIFC Courts have previously used Hedera for notary transaction logs, so Avalanche does not monopolize this sector.

Avalanche ETFs Have Seen No New Inflows Since October 8

Avalanche ETFs are funds that hold AVAX and trade like stocks. These funds reported cumulative net inflows of $31.6 million and net assets of $55.5 million as of October 21, according to SoSoValue. The largest daily inflow over the past month was $2.5 million on October 8.

However, from October 9 to October 21, these funds saw zero net inflows. In contrast, Solana’s ETFs held about $1.66 billion in mid-October, roughly 30 times more than Avalanche funds.

Wall Street Has Experimented With Avalanche but Hasn’t Committed

Intercontinental Exchange (NYSE:ICE | ICE Price Prediction), which owns the New York Stock Exchange, has been testing Avalanche for about a year to continuously trade tokenized stocks and ETFs. A tokenized stock represents a share on a blockchain. However, ICE has not yet announced a formal deal or launch date.

Excitement around these tests and the Helicon network upgrade initially drove AVAX up 55%, from $7.60 on September 17 to $11.80 by September 21. However, after Helicon went live on September 22, the price slipped 8% as traders sold off their holdings.

Is Avalanche a Good Investment With the AVAX Price Near $9?

In our view, AVAX is unlikely to return to its previous high of $145 in the coming years. Growing supply, stalled ETF inflows, and competition from larger networks pose significant challenges. Nevertheless, long-term investors who expect government and institutional use to drive demand might view the October 22 price of $9.26 as a good entry point, especially since AVAX has gained 47% over 90 days from $6.30 on July 24.

For a meaningful recovery, AVAX would first need to surpass its September high of $12, up 29.6%. Next, it would require renewed ETF inflows and a commitment from ICE or another major institution to use Avalanche, with AVAX financing the fees. If these conditions aren’t met, a price drop below $9.25 could trigger a decline toward the June low of $5.68, about 38.7% lower, marking the next significant support level.

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