Avalance at a Glance
Avalanche (AVAX) is a digital currency and blockchain platform that competes with Ethereum. AVAX is the native token of the Avalanche blockchain, which, like Ethereum, utilizes smart contracts to support numerous blockchain initiatives. Avalanche was launched in 2020 with the goal of being rapid, versatile, secure, cost-effective, and readily accessible. Additionally, Avalanche is an open-source project, which implies that anyone can view and contribute to the platform’s code.
The Avalanche blockchain facilitates rapid transaction finality. AVAX is used to pay processing fees, secure the Avalanche network, and act as a basic unit of account across the Avalanche network’s blockchains.
Understanding the Core
Avalanche’s platform supports both dApps and autonomous blockchains, featuring unique capabilities like
- Coin creation rate: The total supply of AVAX tokens is limited to 720 million. However, the rate at which new coins are created is determined by AVAX users through voting. The amount of AVAX rewarded for adding a new block to the Avalanche blockchain can be adjusted by AVAX holders, allowing them to control the pace of new coin creation.
- Transaction fee structure: Transaction processing costs on Avalanche’s network depend on the type of transaction and the level of network congestion. All fees charged for transactions are permanently removed from circulation, effectively reducing the total supply of AVAX over time. The Avalanche community votes to determine the transaction fee on the network, which means that fees are subject to change based on the community’s decision.
- Consensus mechanism: Transactions on the Avalanche blockchain require many small, random subsets of network participants to confirm transactions before they are finalized.
- Participation incentives: High uptime and quick response times can increase the amount of AVAX rewards earned by a participant for processing AVAX transactions
- Proof of Stake Mechanism of Validation: Avalanche operates on the proof-of-stake mechanism. To validate AVAX transactions, AVAX holders are required to stake their holdings, which means they have to agree not to sell or trade their AVAX in exchange for the right to validate transactions. Validators who have the most staked AVAX and are actively participating are more likely to be chosen for Avalanche blocks. Apart from this, holding AVAX tokens is also necessary for voting on Avalanche governance proposals.
Founders
Emin Gün Sirer: Emin Gün Sirer is a Turkish-American computer scientist who developed the Avalanche Consensus protocol for the Avalanche blockchain platform. He is currently the CEO and co-founder of Ava Labs.
AVAX Funding
In September 2021, the Ava Labs Foundation received a $230 million investment from a group consisting of Polychain and Three Arrows Capital, through the purchase of the AVAX cryptocurrency.
In September 2021, the Ava Labs Foundation received a $230 million investment from a group consisting of Polychain and Three Arrows Capital, through the purchase of the AVAX cryptocurrency.
AVAX Partnership
Avalanche blockchain entered the top 10 cryptocurrencies by market cap after partnering with Deloitte to enhance US disaster relief funding.
Avalanche announced a partnership with Amazon to enhance Avalanche’s infrastructure and decentralized application ecosystem.
Loco, an Indian game streaming platform, collaborated with Avalanche Blockchain.
AVAX Security and Governance Concerns
In August 2022, whistleblower “Crypto Leaks” published a report accusing Ava Labs of secret deals with a law firm aimed at legally destabilizing Avalanche’s competitors. Ava Labs CEO Emin Gün Sirer denied any sort of illegal or unethical deal with Roche Freedmen law firm
In August 2022, whistleblower “Crypto Leaks” published a report accusing Ava Labs of secret deals with a law firm aimed at legally destabilizing Avalanche’s competitors. Ava Labs CEO Emin Gün Sirer denied any sort of illegal or unethical deal with Roche Freedmen law firm
Where Avalance makes the cut
- The transaction processing times are fast.
- The reward system motivates individuals to participate.
- Capable of supporting many blockchain-based projects
Where Avalance Misses Out
- There are some platforms like Ethereum that pose stiff competition.
- To become an Avalanche validator, one must stake 2,000 AVAX tokens.
- Another notable point is that Validators who act maliciously or carelessly are not penalized by losing their AVAX tokens.
