What is the Avalanche Network?
Avalanche does not have any promotional material, just nerdy documentation and lengthy white papers, lucky for you.
Avalanche Consensus Model
The consensus model people utilized for a long time was called the practical Byzantine Fault. Around the 1980s, this thing took off and was essentially a computer science algorithm that helped a bunch of things come together and conclude based on the information they had. Next, around 2009, there was bitcoin which introduced the Nakamoto era of consensus. It created and shared the proof of work mechanism, which was in many ways better than the old Byzantine model. Then, in 2020 avalanche launched their avalanche consensus model network. The network follows the proof of stake, but it does have a few unique differences. First, the avalanche model uses a form of sub-sampled voting.
This means that a large group of people volunteer to participate in the network and get randomly asked to check things. Small random subsets of validators are asked whether they think the transactions would be accepted or rejected. After it is initially believed to be valid, something called network gossip happens. The participants exchange information repeatedly and continue to validate the transactions or deny them. One of the benefits of this is that contrary to proof of work and proof of stake mechanisms, it doesn’t matter how many nodes there are, how many people there are in the system; consensus will be reached within a specific desired time frame. Also, due to this consensus model, it is more difficult to attack, unlike bitcoin, where one would need 51% of all the personal computers to attack the web network, or Ethereum 2.0, where you would need 51% of all the staked tokens to attack the network. With Avalanche, you would need to control up to 80% of the network to perform an attack. This model allows for up to 4500 transactions per second per subnet and has a finality clock of fewer than three seconds. Each subnet can process and support up to 4500 transactions per second, and if you have a thousand subnets, you can do a lot of transactions. However, bitcoin allows seven transactions per second in an hour-long finality. Also, Ethereum pales to compare with 15 transactions per second and a 10-minute finality.
It has three built-in blockchains with it. Avalanche isn’t one blockchain; it is three. So the first blockchain in the network is called the X-Chain. This is the part specifically for creative management and the transaction of tokens on the web. Now the engineers would tell us in technicality. This is usually based on a DAG, a unique form of a consensus model, unlike a blockchain. Next, we have the C-Chain, which is specifically for the Smart Contracts. It is an exact copy of the Ethereum virtual machine so that you can instantly copy and paste to start using Ethereum dApps on the Avalanche network. They allow developers to move their projects over without doing much work. This chain also uses something called the Snowman Protocol. The third one is the P-Chain or the platform chain, and it is specifically for the management of the subnets. It also coordinates validator nodes and the staking mechanism.
What are Subnets?
Each subnet is a new and innovative network in the Avalanche ecosystem. This system is scalable in many ways. Each subnet can have multiple blockchains, precisely like the primary Avalanche network. Secondly, every blockchain in a subnet can have its consensus model. This means if you are creating one, you can prefer proof of work or proof of stake, depending on your needs.
Further, each blockchain can have its own VM or virtual machine. You can copy the Ethereum virtual machine just like the primary chain did. These subnets can be permissionless or permissioned. This means that they can be public or private blockchains. If you are a government and you want the full power of a blockchain without developing the groundwork, you can add a subnet in Avalanche’s ecosystem. This way, you can use these powerful tools without wanting to invest in something new. In Avalanche, you can even change the rules for each blockchain in your network. You can make it so that it is compliant across many different geographic or political requirements.
The leading primary network uses the Avalanche consensus model, but AVA Labs created a more powerful consensus model called the snowman protocol. The difference between the snowman protocol and the avalanche protocol is small yet powerful. The snowman protocol is the linearized version of Avalanche to fit the needs of the Ethereum virtual machine. The snowman protocol has been optimized for smart contracts and high throughput. On the other hand, Avalanche is a more general use case where it is implemented using a day structure which is also seen on the X Chain. These were technical terms, but you need to know that the avalanche developers are innovative and optimize things as appropriate they can for the situations they see fit.
Tokenomics of AVAX
There is a max cap of the coins at 720 million. This makes it a deflationary asset. Secondly, avax coins can be used as the governance on the platform, meaning the more coins you hold and stake, the greater voting rights to make more critical decisions in the network. Another worth noting is that the team and foundation were also given around 20% of all coins. Ultimately, what you’ve been waiting eagerly for is the good news about AVAX that the Avalanche foundation has announced a distinct 180 million dollar incentive program to make people try out their network. This means they are giving away 180 million dollars for free in the form of advertising. It happens all the time in the DeFi world, and it is not a scam.