Subnets — the future of blockchains ?

Tom Shnaider
Coinmonks
4 min readMar 28, 2022

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Following the Avalanche Summit last week, we wanted to explore the concept of subnets with you.

Avalanche

First of all, some introduction might come in handy for those of you that are unfamiliar with the blockchain.

Avalanche is a Layer 1 blockchain, built to be faster, cheaper, greener and adaptable.

The way they achieved that was through the fractionalization of different aspects of the blockchain. For example, validation is made by sub-groups of specific validators and not a sub-group of the whole network every time. The blockchain itself is separated into three chains: the x-chain, the p-chain and the c-chain.

You can see all the details concerning these chains in the picture below:

Overview of the Avalanche network of blockchains. From https://docs.avax.network

Subnets

Every subnet is a smaller group of validators collaborating to manage one specific blockchain. Validators can work on different subnets.

By the way, Avalanche uses an overall Delegated Proof of Stake protocol which implies that to become a validator you need quite a big amount of AVAX to stake. To understand more about different consensus protocols head over to our older article:

https://medium.com/@tomshnaider/understanding-consensus-34f0596b6a2f

The idea is to create smaller blockchains that are optimised for their purpose.

The extent of the customisation that is possible on these subnets is incredible and even if other examples of this approach exist, the project here is to bring an extremely user friendly experience and to democratise the use of blockchains.

To give some examples of customisation, you could:

  • Customise the consensus-protocol of your subnet
  • Define if your blockchain is public or private
  • Add any conditions you can imagine, like KYC requirements

Every blockchain has its own Virtual Machine, which is basically the set of rules that govern the blockchain, it also runs the API (Application Programming Interface) which the end-users will use to interact with the blockchain.

Differences

Most other blockchains run on a single Virtual Machine, which means that they have a set of rules for the whole ecosystem.

It’s definitely an over simplification: Ethereum has smart contracts to define different rules in a sub-ecosystems, Polkadot has parachains to bridge different protocol cultures and bridge blockchains. But we‘ll stay on course and focus on Avalanche.

If you want to change something on a blockchain that has a single set of rules, you’d need to fork the whole blockchain and start anew. You would have a blockchain that works perfectly for your project but you’d need a lot of people to join your project in order to have a decentralised and thus safe network/community.

Avalanche’s solution to that is to make the creation of a technically-optimised blockchains easy and accessible. Which allows you to be optimised and to enjoy the safety of a huge blockchain like Avalanche.

Oh and did I mention that every subnet can launch its own token ? Imagine the possibilities: fundraising, DAOs, new projects… anything. It’s all you can do on Ethereum, of course, just cheaper and with an approach that can seduce a lot of projects in the coming months and years.

Concluding thoughts

The same way WordPress made creating a website relatively easy, subnets will allow anyone to create their own blockchain. It’s a pivotal point for Avalanche and we’ll see how the market reacts to this historical moment in the upcoming months — spoiler alert, the market reaction has been very positive up until now.

Some criticism can be found, concerning these subnets. Mainly, evoking the fact that subnets aren’t that much of a revolution, that they’re basically side-chains, or an equivalent of parachains in the Polkadot ecosystem.

But we don’t believe it matters, this only confirms that fractionalization of blockchains might very well be the future of blockchain. A very smart way to democratise the use of the technology.

It’s worth stopping and appreciating the technical revolution that unfolds in front of us every single day. The thought, ingenuity and effort behind these technological advancements will take years to fathom.

To put it lightly, this is mind blowing and very cool, without even going into the details of how these wizards are developing that.

Bonus: the Core wallet

Avalabs just announced the launch of Core, their very own non-custodial wallet. Designated to offer a seamless experience through the whole ecosystem.

The wallet is ledger compatible, can store and display NFTs and has an integrated swap and an on-ramp solutions, through moonpay.

Moreover, they’ve mentioned a contact list interface and the ability of separating a wallet into multiple accounts.

For more

If a technical dive is of interest to you follow these different links:

Thank you for reading,

Take care.

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