Why Avalanche Will Skyrocket

Invest in Avalanche, one of the fastest blockchain networks in the world.

Last Updated February 2nd 2022
6 Min Read

Avalanche (AVAX) is a smart contract-capable blockchain platform focused on transaction speed, low costs, and eco-friendliness. This emerging crypto protocol is focused on delivering a highly scalable blockchain without compromising on decentralization or security.

Launched in 2020 by the Ava Labs team, Avalanche quickly ascended the cryptocurrency rankings and made headlines in the crypto community. Similarly, Avalanche TVL (total value locked in the protocol) is skyrocketing and worth over $3 billion across Avalanche dApps.

With a stellar team and passionate community, Avalance is on its way to building the fastest blockchain. For these reasons and many more, Avalance is likely to skyrocket in 2022.

Why Choose Avalanche?

Ava Labs, the founders and developers of Avalanche, believe they have built the fastest smart contract blockchain platform to date. Utilizing three different blockchains under the hood, Avalanche performs at internet-scale for a future wherein crypto is a global backbone technology.

The Avalanche mainnet is live and hosts a vibrant, growing community backed by a $230 million ecosystem fund. Founded in 2019 by Dr. Emin Gun Sirer, Avalanche has aimed to achieve the quickest time to finality for blockchain transactions since day one. Time to finality is how long it takes for a crypto transaction to process and be considered permanent and irreversible. Once a transaction has achieved finality, it cannot ever be rolled back or altered. 

Finality is a significant blockchain feature (especially for financial applications), but time to finality is not equal across different blockchains. Ethereum, for instance, achieves finality in about one minute. On the other hand, avalanche achieves finality in one second, which is near-instant in real-world usage. 

Avalanche’s core innovation is it is composed of three blockchains rather than the usual one. The reason behind this design choice is quite innovative. Each blockchain specializes in tasks within the broader Avalanche ecosystem instead of having one chain do them all.

Distributing tasks amongst different chains helps keep the Avalanche platform agile, helping it achieve the golden trinity of blockchain traits — decentralization, security, and scalability.

Is Avalanche Going To Skyrocket In 2022? 

The Avalanche team is tackling some of the most prevalent issues affecting large-scale blockchain adoption, such as scalability, speed, and security. The crypto seeks to manage these issues through cutting-edge capabilities and the development of design principles. Let’s delve deeper into the factors that are driving Avalanche to skyrocket. 

Don't Miss: Is Avalanche (AVAX) Safe To Invest In?

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Factors That Help Avalanche Surge to New Heights

1. Network Architecture and Scalability

Avalanche is a form of layer-1 blockchain that operates as a platform for custom blockchain networks and decentralized applications (dApps), launched by Ava Labs. The Ethereum network is one of the leading currencies and the most popular blockchain for smart contracts. Now, Avalanche is in direct competition with the Ethereum network, and it focuses on surpassing Ethereum on that front. 

To achieve its goal, the platform is equipped with an elevated output of nearly 6500 transactions every second without compromising on scalability. In addition, the platform describes itself as a programmable and open smart contracts platform for several decentralized applications. It is also compatible with Ethereum’s programming language and can be implemented to deploy public and private blockchains as subsets. 

Furthermore, developers who create using the Avalanche platform can easily develop reliable and secure applications. They can also build custom blockchain networks having a complex set of rules. Avalanche is known to allow users on the platform to create anything they imagine by providing them with complete control over both applications layers as well as the network itself. 

Notably, the founding team launched Avalanche on the mainnet in September 2020. In addition to this, after its mainnet launch last year, Avalanche has been seen working on developing its very own ecosystem of decentralized finance (DeFi) along with decentralized applications (dApps). 

Several projects based on Ethereum, including TrueUSD and SushiSwap, have integrated with Avalanche. While the platform is dedicatedly working on improving interoperability between Ethereum and its own ecosystem, it majorly does that with the help of bridges.  

2. Unique Features and Capabilities 

The developers of Avalanche refer to it as the platform of platforms as it uniquely leverages three different blockchains to create a trustless and interoperable framework for the developers. The three individual blockchains are called C-Chain, X-Cain, and P-Chain. 

The Exchange Chain, or as commonly referred to as the X-Chain, is employed to exchange and develop the AVAX token with other assets. Similar to the standard of ERC-20, these tokens follow a standardized set of rules while using a different consensus mechanism. On the other hand, the Contract Chain (C-Chain) hosts decentralized applications and smart contracts. 

Not just that, the blockchain has its own Avalanche Virtual machine, which is somewhat similar to the Ethereum Virtual Machine, which allows developers to fork decentralized applications that are EVM compatible. Also, it uses the well-known Snowman consensus mechanism. Lastly, the Platform Chain (P-Chain) is responsible for coordinating with all the network validators, along with tracking already active subsets and enabling the creation of newer subsets. 

3. Avalanche-Ethereum Bridge 

The Avalanche-Ethereum Bridge represents a step towards migrating Ethereum's slow and costly DeFi infrastructure to the significantly faster and cheaper Avalanche network. Transaction fees on Avalanche are rarely more than a few cents. At the same time, complicated computations cost in the single-digit dollar range to execute and are significantly faster and near-instantaneous. 

One of the prominent players in this new DeFi ecosystem is Pangolin, a "community-driven decentralized exchange for Avalanche and Ethereum assets with rapid settlements, low transaction fees, and a democratic distribution." 

Alongside Pangolin, many other dApps are joining the Avalanche ecosystem across various use cases, making it a fully-featured network right from launch. Such applications include bZx, Prosper (a decentralized non-custodial prediction market), Jelly Swap (atomic cross-chain swaps and token trading across Avalanche, Bitcoin, Ethereum, Harmony, and Binance Smart Chain), etc. 

The implications of the Avalanche network and the Avalanche-Ethereum Bridge are far-reaching. Investing in AVAX now is an easy way to become a part of the growing Avalanche ecosystem.

4. Network Benefits and Future Roadmap 

The low cost of transactions on Avalanche means that smaller trades are more financially viable, opening up the DeFi ecosystem to smaller players and entry-level investors. While the user experience is still complex and represents a significant barrier to entry, improvements in this area could lead to a wider range of participants in the world of DeFi.

The slow speed of the Ethereum blockchain often leads to significant slippage and failed transactions when conducting on-chain trades. The faster transaction rate and higher throughput of the Avalanche network open the door to minimal price slippage and instant trades, bringing the experience of trading on DEXs closer to their centralized counterparts.

Check Out: Best Methods On How To Earn Avalanche (AVAX) Coins Fast

Final Thoughts 

Given the past performance of the platform, when combined with what it has to offer and its plans for the near future, Avalanche could be the right choice for a long-term investment that might reward you with good returns over time. 

Avalanche was launched on the popular crypto exchange, Coinabse.com in November 2021, which could boost the prices. For all these reasons, Avalance is likely to skyrocket in 2022. 

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Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

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