Avalanche is an open-source platform for running customized blockchains, decentralized applications, and smart assets. Aside from significant scalability, appropriate security, and high speed, Avalanche offers some other features that differentiate it from other rivals. In this article, we are going to cover everything about Avalanche and its native token, AVAX. Stay with us.
What is Avalanche?
Avalanche is a blockchain network with unique features and purposes. Unlike the majority of blockchains like Bitcoin and Ethereum, Avalanche is not limited to one blockchain and one set of validators. Instead, it is a network consisting of different blockchains and different sets of validators.
Exactly like Ethereum, Avalanche has the capability of creating smart contracts and running decentralized applications. But the big difference Avalanche has with Ethereum is that in Avalanche, each smart contract is run on its own blockchain. Each blockchain is then investigated and validated by one “subnet”. This feature in Avalanche enables the possibility of designing customized blockchains and building unique decentralized applications.
Avalanche also lets the creation of digital assets and tokens. Any developer and blockchain owner can develop his/her desired token with specific rules and characteristics. Avalanche’s consensus algorithm is of the Proof-of-Stake type, and it can process thousands of transactions per second.
In the following parts, we will go through Avalanche’s innovations and its technical aspects in more detail.
How does Avalanche work?
In the previous parts, we referred to an innovation in Avalanche called “subnet”. Subnets are crucial parts of Avalanche’s processes and they play key roles in its functions. Let’s take a closer look at the concept of the subnet and its purpose.
What is a sub-net in Avalanche?
In blockchains like Bitcoin and Ethereum, all validators are obliged to obey the rules of the protocol, but Avalanche is different in this regard. In Avalanche, each blockchain can have its unique set of rules. The subnet is a dynamic collection of validators that cooperate to reach a consensus on the state of a blockchain. Each blockchain is validated and processed by exactly one subnet. By the way, each subnet can manage a number of blockchains. Each node can also participate in a number of subnets.
Avalanche also has a default subnet that manages Avalanche’s built-in blockchains. All participants of all subnets must be a participant of the default subnet. To do so, they have to stake a certain number of AVAX tokens.
You may now wonder what built-in blockchains are. Avalanche has three built-in blockchains called “X-Chain”, “P-Chain”, and “C-Chain”. Let’s elaborate more on these three built-in blockchains.
X-Chain is a decentralized platform for creating and trading smart digital assets. The X letter in X-Chain comes from the word exchanging. One of the assets that can be traded on X-Chain is AVAX, Avalanche’s native token.
P-Chain is another built-in blockchain that can manage the giant data belonging to Avalanche. The P in this name comes from the word platform. Using P-Chain’s API, users can create subnets, add validators to subnets, and build blockchains.
The last built-in blockchain on Avalanche is C-Chain, the C letter in which comes from the word contract. C-Chain is something like the Ethereum Virtual Machine that works on Avalanche. Using this blockchain’s API, users can create smart contracts and do other activities similar to those they do on Ethereum.
The AVAX token
Like all other blockchain networks, Avalanche has its native token called AVAX. At the time of writing, each unit of AVAX is being traded at $18.26. Its price peak goes back to November 2021 when it reached more than 130 dollars. Avalanche has a market cap of $5,164,950,855, and AVAX has a supply cap of 720,000,000 units. More than 280,000,000 units have now been issued.
The AVAX wallets
Like all other cryptocurrencies, you need digital wallets to store AVAX. Not all cryptocurrency wallets support AVAX, but some of the best wallets for this purpose include:
- Trust Wallet
- Assure Wallet
- Math Wallet
Avalanche is one of the third-generation blockchains with completely unique and new features. Aside from offering a high level of scalability, the ability to create customized blockchains is Avalanche’s most significant characteristic. What do you think about Avalanche? Do you find it promising? Have you invested or do you consider investing in AVAX?