Analysis of Algorand’s Price Movement and On-Chain Metrics
Algorand, a top layer-2 network, has been exhibiting promising fundamentals that could propel its price higher in the coming days. As of January 23, 2025, the coin was trading at $0.4165, which is about 16% below its highest level last week. Despite the sideways movement this week, mirroring the performance of most altcoins following Donald Trump’s inauguration, several on-chain metrics indicate strong growth for the network.
Increase in Active Addresses and Transactions
According to Nansen, the number of active addresses on the Algorand network rose by 56% over the last seven days to 892,786, giving it the third-highest weekly growth rate after Arbitrum and Blast. This significant increase in active addresses suggests a growing user base and potential adoption of the network. Furthermore, Algorand’s transactions increased by 6.9% to over 11.4 million, while its weekly fees rose by 20% to nearly $15,000. These numbers demonstrate a surge in network activity, which is often a precursor to a price increase.
Recent Upgrade and Partnerships
The Algorand 4.01 upgrade, which introduced the ability for consensus participants to opt-in to incentives and added a feature allowing developers to build zero-knowledge-proof applications on the network, has likely contributed to the increase in network activity. Additionally, the partnership with Eni, a leading Italian energy company, to launch a solar power tokenization project on Algorand, further validates the network’s potential for real-world applications.
Total Value Locked (TVL) Recovery
More data from DefiLlama shows that Algorand’s total value locked (TVL) in the decentralized finance (DeFi) industry is recovering, climbing to $155 million, up from its monthly low of $126 million. Most of this growth was driven by Folks Finance, which has over $260 million in assets. This recovery in TVL is a positive sign for the network, as it indicates growing confidence in Algorand’s DeFi ecosystem.
Predictions for Algorand’s Price Movement
Based on the analysis of Algorand’s on-chain metrics and recent developments, there is a potential for a significant price surge. The formation of a symmetrical triangle pattern on the weekly chart, which is part of a bullish pennant, suggests that the price could break out strongly in the coming weeks. A bullish breakout could push the price to the next key target at $0.6127, its November high, representing a potential 50% gain from current levels.
However, it is essential to consider the potential risks and uncertainties associated with cryptocurrency markets. A drop below the key support at $0.3290 would invalidate the bullish outlook and suggest further downside toward the support level at $0.1085.
In conclusion, Algorand’s increasing active addresses, transactions, and TVL, combined with its recent upgrade and partnerships, make a strong case for a potential price surge. As the network continues to grow and mature, it is likely to attract more users and investors, driving up the demand and, subsequently, the price of ALGO.
