What is Avalanche?

Launched in September 2020, Avalanche describes itself as an "open, programmable smart contracts platform for decentralized applications." It aims to provide a higher transaction output of up to 4,500 transactions per second, while other blockchains such as Bitcoin claim around 7 TPS in 2023. The Avalanche network is composed of three individual blockchains: the X-Chain, C-Chain, and P-Chain, each serving a distinct purpose, allowing Avalanche to handle a variety of use cases with different consensus mechanisms. Avalanche is compatible with Solidity, the programming language used by the Ethereum network, which means developers from one of the largest and most engaged communities in crypto can build on Avalanche and use it to deploy custom private or public blockchains as "subnets." And just like Ethereum, Avalanche can power a wide variety of applications like stablecoins, DeFi protocols (lending, savings, decentralized trading), and NFTs. Like many other decentralized protocols, Avalanche has its own token called AVAX, which is used to pay transaction fees and can be staked to secure the network. There will only ever be 720 million AVAX coins in circulation.

How does Avalanche work?

Avalanche operates through its unique architecture, which consists of three individual blockchains: the X-Chain, C-Chain, and P-Chain. The X-Chain is used to create and exchange the native AVAX tokens and other assets, following a set of standardized rules. The C-Chain hosts smart contracts and decentralized applications with its own Avalanche Virtual Machine, allowing developers to fork EVM-compatible DApps. The P-Chain coordinates network validators, tracks active subnets, and enables the creation of new subnets. This division of tasks allows Avalanche to achieve higher throughput without compromising on decentralization.

What are the potential use cases for Avalanche?

Avalanche seeks to provide a platform for a wide range of use cases. Several projects have already integrated with Avalanche, and its modular structure enhances Avalanche's interoperability with other blockchains.

What is the history of Avalanche?

Avalanche was launched by Ava Labs, founded by Cornell University professor Emin Gün Sirer and Cornell University computer science PhDs Kevin Sekniqi and Maofan "Ted" Yin. Gün Sirer is a veteran in cryptographic research, having designed a conceptual peer-to-peer virtual currency six years before the release of the Bitcoin whitepaper. He was also involved in work on Bitcoin scaling solutions and research on Ethereum before the infamous "The DAO" hack in 2016. From that research, the whitepaper that led to the foundation of Ava Labs in 2018 arose. The project closed a seed round in February 2019 that included investors such as Polychain, Andreessen Horowitz, and Balaji Srinivasan. Avalanche completed its initial coin offering in 2020 in under 24 hours.

How do you buy AVAX?

You can buy, send, and receive AVAX using your Coinbase account. Or, you can buy AVAX by using the official Avalanche "Bridge" and trading ETH (or other Ethereum tokens) for AVAX in a peer-to-peer way. In order to bridge from the Ethereum ecosystem into Avalanche, you will first need a non-custodial wallet and decentralized application browser like Coinbase Wallet.

Can you stake AVAX?

AVAX rewards can be earned by staking directly on the Avalanche network (note: Coinbase does not currently enable staking directly on its platform), which helps secure, validate, and govern Avalanche while enabling the following features: (1) Fast, peer-to-peer transactions, (2) Decentralized computation and storage, (3) Creation of new "subnet" blockchains. Participants become general network validators by staking their AVAX on the Avalanche Platform Chain (P-Chain). Participants can also delegate their stake to another validator, who then earns a portion of their validator reward. You can also become a validator of specific subnet blockchains by staking AVAX.