What's Avalanche?
Avalanche launched in 2020 as a platform for smart contracts, the creation of decentralized applications, or dapps, and subnets, or custom blockchains.
"Subnets are powerful, reliable and secure private or public blockchains built as offshoots to the core Avalanche platform," John Wu, president of Ava Labs, tells CNBC Make It. "Developers of these custom blockchains have complete control over the design, with the only requirement being to participate in securing the core platform."
Wu sees subnets as a powerful use case for Avalanche going forward.
Avalanche operates on a proof of stake (PoS) model, where validators verify transactions according to how many coins they hold. Supporters of PoS say it is significantly less energy intensive than other models and has less of an environmental impact.
How does it compare to Ethereum?
As demand for Ethereum, the most used blockchain network, has surged this year, other projects have emerged in an attempt to compete.
"Ethereum is the leading all-purpose blockchain, but there is significantly more demand for Ethereum's utility than the blockchain can currently handle," Hougan says. "As a result, you're seeing the rise of a number of Ethereum competitors. Avalanche is one of them."
Avalanche is "designed to be faster and cheaper to use than Ethereum, processing more transactions per second at a lower cost," Hougan says. According to Ava Labs, Avalanche can process over 4,500 transactions per second, while Ethereum can support roughly 15 transactions per second.
Apart from this the avax network is designed to allow subnets to work with it. Subnets are basically better versions of the rollups and such that eth is pursuing. And they will all work out of the box with Avax main net, and they will be able to host their own logic and VMS. This means that you can create a subnet for a say.. monero(which is not compatible with traditional erc20 networks) and then natively bridge monero to smart contracts on that subnet. That means the subnet will be able to send and receive monero on the subnet.
So last week avax is doing the same, or upto 80% of Ethereum's volume. We love avax buring their transaction fees. We love the proof of stake, we love the environmental friendliness of the chain.
We hope to scale yes. We hope to keep the transaction cost low! We want to be $4000 token some day.
So I think the real question is does ETH hope to scale to Avalanche level of adoption?
Because I would bet good money avax has more actual users right now. Nobody is using ETH except 2 to 5 thousands whales and bots.