Fresh back from the long weekend it’s time to take a look at a project that has been getting a lot of attention lately, and break down why it is exploding and what makes it tick. I am of course talking about the Avalanche network, and their very new approach to how they structure their network and how it has some pretty powerful functionality.
For the usual disclosure, I am not a financial advisor, I don’t even work in finance at all. My day job is as a telecommunications software engineer. Treat everything you read here as some educational resources and not financial advice.
The Avalanche network has created their own proprietary consensus model that is similar in nature to Proof of Stake (PoS) but has some pretty key differences.
The first of these major differences is that they have a feature called Subsampled Voting. Essentially, they have a large pool of validators, and from that pool a subset is randomly selected to validate things. After a block is initially validated, network gossip happens where data is passed around and all the transactions are checked and are either accepted or denied.
This approach means that it doesn’t matter how many nodes are up and operational, consensus can always be reached within a certain timeframe. It also makes the network not susceptible to 51% attacks. It would actually require around 80% control in order to carry out something like a double spend attack.
This consensus model has a throughput of 4500 transactions per second, on each of the subnets (see below for what an Avalanche subnet is). It also allows for transactions to be confirmed in under 3 seconds, versus the up to hour we see on other networks such as Bitcoin.
The Avalanche network’s primary network, is made up of three separate blockchains, each providing a different set of functionality.
The main blockchain is the X-Chain, which is responsible for all the transactions, as well as creating and managing the tokens. It’s the main base chain where all the goods are happening.
Next up is the C-Chain, which is where smart contracts are handled, and is a fork of the Ethereum Virtual Machine, so all the Solidity contracts that have already been written, are able to be deployed here with little to no changes required. This of course makes it very easy for existing protocols to jump on this network with little effort.
Finally is the P-Chain, which manages the subnets, coordinates the validators, and controls the staking mechanism for the network. It’s basically the overseer of the rest of the network.
Another very important part of the Avalanche network, is it’s Snowman Protocol. This is an even more powerful consensus model than the one that is utilized on the main network. It’s a linearized version which has been optimized to execute smart contracts on the virtual machine, versus the DAG structure that is used on the X-Chain.
This section is technically still part of the network design, but it warrants it’s own heading, as it’s a very important piece to the puzzle of what makes the Avalanche so different from a lot of the other blockchains, and what sets it apart.
A subnet is basically a whole separate network within the ecosystem, and can be either a public network, or a private one. Each subnet can have multiple blockchains within it, and each blockchain can even have it’s own consensus model, and run it’s own virtual machine for executing smart contracts, including just forking the Ethereum Virtual Machine and using that.
This means that the network is very easily scalable, as each subnet is going to be capable of performing the same 4500 transactions per second. It also allows an organization to leverage blockchain technology, without having to go through the hassle of setting up their own from the ground up. The fact you can setup a private/permissioned subnet, also means that say a government or large company could setup their own private subnet and gain access to blockchain technology without having to design their own network.
The Avalanche network is a pretty big new player, and I can foresee a big future for them. There is a little bit of worry on their token, as a large portion of the total supply was presold with a lockup, plus the team was given a large allocation, so there is potential for some sell pressure, especially as the lockup periods end.
The being said, there is a large incentive program working on pulling in Curve and AAVE to their platform, which has driven major price increases in recent weeks, and honestly, if their technology passes the battle test of some time, I think there is a lot of potential in this network.
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Originally Posted On My Website: https://ninjawingnut.xyz/2021/09/06/avalanche/