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What caused the recent Avalanche AVAX price plunge?

By:
on Mar 23, 2023
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  • Avalanche price is struggling to reclaim its footing after the latest price dip.
  • At press time, AVAX was trading at $17.40, down 0.45% over the last 24 hours.
  • The Avalanche team has not addressed what caused the latest Avalanche crash.

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Avalanche AVAX price experienced a decline in late March 22. The token dropped from $17.89 to about $16.5 in less than 3 hours triggering shockwaves among AVAX investors seeing that the token has been doing quite well recently.

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AVAX has however recovered from the fall although it is yet to reclaim its $17.89 price level. But what really caused the Avalanche price plunge?

Why did the AVAX price plunge on March 22?

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According to engagements between the Avalanche team and validators on Github and Discord, a number of users were experiencing node outages on Avalanche’s X and C chains.

Avalanche uses three distinct blockchain networks namely the C-chain, X-chain, and P-chain. The C-chain is home to Avalanche’s DeFi space and it is the chain used by people interacting with the likes of MetaMask crypto wallet.

The X-chain on the other hand acts as the exchange layer and it allows users to transfer funds between addresses. At the same time, the P-chain facilitates AVAX staking and validator operations.

One user reported a fatal error on GitHub titled: “FATAL error: failed to verify the transaction in bootstrapping: missing utxo while processing sync message.” And in the additional context area, the user stated that “Some others have described similar issues on Discord.

The error report triggered a string of other users facing the same issue of nodes failing to join in stating that they were trying to upgrade to 1.9.11 and 1.9.12 versions and even downgrade to the 1.9.8 version without avail.

The outage seems to have continued for almost an hour before recovering although the X-chain still remains offline. According to on-chain data, the activity on X-chain has drastically reduced and the chain is only processing very minimal amount of transactions per hour. This means the X-chain is practically unusable meaning users are not able to effectively transfer funds between addresses.

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