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What Is Avalanche: Explained For Beginners

© by Vecteezy

Ethereum has been the most widely used solution for all kinds of DeFi projects for quite some time now. The reason is that this blockchain allows you to employ flexible and reliable smart contracts to manage crypto-related financial platforms. However, it is often criticized for long transaction times and uncomfortably high fees. Avalanche is one of its main rivals — let’s take a look at how this project plans to outperform Ethereum once and for all.

About Avalanche

Avalanche is a relatively new blockchain that aims to make transactions much faster with its own specialized protocol that can process thousands of transactions in one second. Basically, it’s an entire open-source platform that allows any other developers create decentralized apps. Avalanche is made of two main elements: the primary network — and a number secondary networks (that number is actually unlimited). But what is Avalanche in terms of technical structure?

The primary network is in turn made of 3 separate blockchains. One is used to store metadata and organize validators, another one converts Ethereum smart contracts to the Avalanche ecosystem, and the third one manages secondary networks and NFT assets. Anyone can create their own secondary network by paying a small fee, and you can do whatever you want in your own network: basically, it works as a separate blockchain with its own rules.

This structure has made Avalanche one of the main competitors of Ethereum. Indeed, it is much faster than Ethereum, but that is not the only important aspect of a promising blockchain. When it comes to security, Ethereum is much safer: it has about 280 thousand validators, and Avalanche has only about one thousand. That means validators have too much power over the entire network, and having just ten of them means controlling 1% of the blockchain.


Avalanche has its own cryptocurrency named AVAX. Since the public launch of the project in 2020, the coin has definitely seen some highs, but in 2022 it just seems to follow the overall market trend. Since the beginning of the year, AVAX has come down from about $110 to less than $20. However, it remains the 12th crypto in the world by market capitalization, and many people continue to use it.

There’s no way you can mine AVAX, but you can still earn by staking it. Staking is as easy as downloading the official wallet and choosing the coin blocking option. Staking profitability is somewhere around 30% annually.