What is Avalanche?
Avalanche is an open-source platform for running decentralized applications and deploying public and private blockchains in a single, scalable ecosystem. If you want to know how to use it — welcome!
Avalanche consists of a Primary Network and an unlimited number of Subnets.
The Primary Network, in turn, consists of three blockchains:
- Platform Chain (P-Chain) stores metadata, coordinates validators, and tracks subnets;
- Contract Chain (C-Chain) enables the creation of Ethereum-compatible smart contracts;
- Exchange Chain (X-Chain) provides tools for the exchange of data between subnets, as well as the creation of interchangeable tokens and NFTs.
Avalanche subnets are similar to the L2 solutions for Ethereum and the parachains in Polkadot, but with fully isolated blockchain states.
Any Avalanche user can create a subnet. To do so, a fee of 0.01 AVAX is required.
All Avalanche nodes must necessarily verify transactions on the main network, and optionally on other subnets.
Subnet creators can include various parameters, such as running multiple blockchains and imposing their own validator requirements, such as mandatory KYC/AML passing.
Who created Avalanche and when?
The first publication about Avalanche appeared on May 16, 2018. On that day, an anonymous group of Team Rocket developers published ‘Snowflake to Avalanche: A Novel Metastable Consensus Protocol Family for Cryptocurrencies’ on the official IPFS hypermedia communication protocol website.
Twenty-four hours later, Cornell University professor Emin Gun Sirer commented on the publication on Twitter:
In the same year, Emin Gun Sirer co-founded Ava Labs, the leading developer of the Avalanche platform, with colleagues Kevin Sekniqi and Maofan Yin.
In 2019, Ava Labs and Team Rocket released an updated version of ‘Snowflake to Avalanche’ called ‘Scalable and Probabilistic Leaderless BFT Consensus through Metastability’. The company posted it on its website alongside three white papers: about the token, Stablecoin and the Avalanche platform.
In 2020, Ava Labs raised $12 million in a private token sale and $42 million in a public one.
Avalanche launched its main network on September 21, 2020.
What consensus protocols does Avalanche use?
The Avalanche Platform Whitepaper describes the ‘Snow’ family of consensus protocols. There are three consensus mechanisms in it: Avalanche, Snowman, and Frosty.
The project team has so far implemented Snowman in the P-Chain and C-Chain blockchains, as well as Avalanche in the X-Chain network. Frosty is in the works.
The Avalanche protocol uses the Directed Acyclic Graph (DAG) concept, which allows the network to process transactions in parallel.
Validators send requests to each other randomly to determine the validity of transactions. No additional validation is required.
Avalanche has no blocks: the protocol handles parent transactions — vertices. They allow validators to group transactions for voting. The validation process takes place in stages over a series of rounds.
Snowman is based on Avalanche, but it arranges transactions linearly and generates blocks rather than vertices. This is required to work with smart contracts and increase network bandwidth.
How does the Avalanche protocol work?
An author using the pen name Seq explains the process of confirming or rejecting transactions on the Avalanche Hub blog by using the example of nodes collectively choosing yellow or blue.
Nodes select a color and then poll one another. If a node’s decision differs from that of the majority, the node changes its decision.
The node selects yellow and routes requests to five different nodes at random (highlighted by red rings in the figure). Because the majority of them are blue, the sender changes color.
This interaction happens in stages until all nodes are the same color.
The time available for response is limited. This allows you to eliminate nodes that cause significant delays.
The algorithm chooses the nodes at random, but the likelihood of participating in transaction verification grows as the number of Avalanche tokens in the stacking increases.
What role does AVAX play in the ecosystem?
Avalanche (AVAX) is a native platform token with an issue of 720 million. The protocol burns all transaction fees, making AVAX a deflationary asset.
The token can be used:
- For staking with an annual return of 11%;
- Payment of commissions;
- Settlement in Avalanche sub-networks.
How do I become an Avalanche validator?
Requirements for Network Validators:
- Stacking tokens: 2000 AVAX in P-Chain;
- Hardware: 8 core CPU >= 2GHz; RAM: 16GB; 200GB of free disk space;
- Software: AvalancheGo from Ava Labs;
- Operating system: Ubuntu >= 18.04 or Mac OS X >= Catalina;
- Internet connection: IPv4 or IPv6 with an open public port, bandwidth of at least 30 Mbps.
You can use the Avalanche Wallet web wallet to work with the node. It also allows you to connect the node or delegate funds to other validators in the network.
How do I delegate funds to Avalanche Wallet?
Token stacking must take place in the P-Chain. If they are in C-Chain or X-Chain, open Avalanche Wallet, go to the Earn tab, and make a cross-chain transaction.
Ensure that the node is in sync with the Avalanche network. Then add it to your wallet by entering the node ID in the Node ID field.
On the Delegate tab, you can delegate funds to a third-party validator: select the Node ID, and then specify the amount and period of the stacking.
Remember that the delegation period must not exceed the value in the End Time field.
How do I add Avalanche to MetaMask?
Go to the Wallet settings, select Networks from the menu and click Add Network. Fill in the fields:
- Network Name — Avalanche Network;
- New RPC URL — https://api.avax.network/ext/bc/C/rpc ;
- Chain ID — 43114;
- Currency symbol — AVAX;
- Block Explorer URL — https://snowtrace.io/ .
Click the Save button. The detailed instructions for connecting MetaMask, as well as the current list of supported wallets, are available in the Avalanche help materials.
The Chainlist service is used in the second method. Click Connect Wallet, type “Avalanche Mainnet” into the search bar, and then confirm network addition in the MetaMask window.
How is Avalanche evolving?
According to analytics service DeFi Llama, Avalanche-based decentralized protocols have more than $13 billion in blockchain. The top three are the Aave and Benqi striping platforms, as well as DEX Trader Joe’s.
On the day of the main network launch, cryptocurrency exchange Binance added support for AVAX. The token is currently traded on Coinbase, Huobi, OKEx, Bitfinex and other exchanges.
In July 2021, Avalanche Foundation, the nonprofit organization that oversees the development of the Avalanche ecosystem, raised $230 million in a private sale of AVAX tokens.
In early November, the Avalanche Foundation announced the launch of a $200 million Blizzard fund. The organization will use the money to support innovation in the platform ecosystem. Polychain Capital, Three Arrows Capital, Dragonfly Capital and CMS Holdings invested in the fund.
On November 16, Ava Labs head Emin Gun Sirer announced a partnership with accounting firm Deloitte. As part of the partnership, the parties will launch Close As You Go, a cloud-based platform focused on disaster relief.
On November 18, 21Shares announced the listing of an exchange-traded product (ETP) based on the Avalanche token. As of November 19, it is traded on Switzerland’s largest stock exchange, the SIX Swiss Exchange.
On November 24, AVAX entered the top 10 of CoinMarketCap’s market capitalization ranking with a value of more than $24 billion.
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