What is Avalanche? | Avalanche Crypto Explained for Beginners

what is avalanche

What is Avalanche?

Avalanche is a “semi”-permissioned blockchain that bridges siloed public and private blockchains together to enable two things at once. It was designed to be customizable, scalable, and interoperable.

Everything on Avalanche is a subnet, and every chain is part of a subnet. Their consensus protocol was inherently designed to be immune to any type of 51% attack. In order to gain control of the network, an entity would need to acquire 80% of the network’s validators in order to influence such control.

Unlike other blockchains, the digitization of assets on Avalanche can obey special covenants, making it a suitable solution for adhering to legal compliance.

Use cases that the team are developing include Private Securities, ILOs, DEX’s, Synthetics, Stablecoins, Prediction Markets, Equities, Bonds, Debt, and Real Estate.

How did Avalanche Begin?

Avalanche $AVAX was founded by Dr. Emin Gun Sirer, a well-known expert on blockchains and digital currencies. Dr. Sirer is best known for his creation of a peer-to-peer, proof-of-work digital currency called Karma in 2003, six years before the “Bitcoin” whitepaper was released. 

Dr. Sirer has taught distributed ledger technology at Cornell University for over two decades. It’s here that the idea for Avalanche was created with a dozen other Cornell Alumni.

After theory and testing, Avalanche was launched in September 2020 after raising $60 Million in initial funding. $AVAX has a maximum supply of 720 Million, of which more than half are locked into the network for “Staking”.

How does Avalanche Work?

Avalanche is split into three separate blockchains that are combined to create the Avalanche Primary Network:

  1. The Platform Chain (P-Chain): The metadata chain. It coordinates validators, keeps track of active subnets, and allows for the creation of new subnets using the Snowman consensus protocol.
  2. The Exchange Chain (X-Chain): The default asset chain. It enables the creation of new assets, exchanging between assets, and cross-subnet transfers using the Avalanche consensus protocol.
  3. The Contract Chain (C-Chain): The default “Smart Contract” chain. It enables the creation of any Ethereum-compatible smart contracts using the Snowman consensus protocol.
avalanche crypto

Key Milestones for the Team

In November 2020 the Avalanche-Ethereum “Bridge” was completed, using ChainBridge as a two-way token bridge that enables seamless transfers between Avalanche and Ethereum. This enabled the full use of $ETH within decentralized applications on Avalanche by locking $WETH in the ChainBridge contract to mint an equivalent token on Avalanche. Through this, the Avalanche-X program was created in order to fund future development proposals put forth by the community.

Avalanche Protocol includes a burning mechanism that burns all fees collected using their platform. Soon they will introduce Quantum Resistance and Privacy Sub Networks in a future update of the protocol. Avalanche has partnerships in place with Reef Finance, SushiSwap, TrustSwap, Simplex, TrueUSD, Injective Protocol, Bitpanda, OKCOIN, Aleph.im, e-Money, bZx, Ankr, Bitfinex, and dozens of other top-quality projects.

What is Avalanche? | Avalanche Crypto Explained for Beginners - - 2022

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What is Avalanche? | Avalanche Crypto Explained for Beginners - - 2022
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