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– TIMESTAMPS –
2:27 What is Avalanche?
4:30 Current Consensus
7:21 Avalanche Consensus
10:55 Avalanche Platform
14:10 AVAX Token
21:25 Final Thoughts
⛓️ 🔗 Useful Links 🔗 ⛓️
► Avalabs Website: https://www.avalabs.org/
► AVAX Network: https://info.avax.network/
► Consensus Whitepaper: https://files.avalabs.org/papers/consensus.pdf
► Consensus Mechanisms: https://medium.com/geoprotocol/evolution-of-consensus-mechanisms-from-classical-methods-to-local-consensus-490b19cc8661
► Longest Chain: https://learnmeabitcoin.com/technical/longest-chain
📝 What is Avalanche? 📝
Avalanche is an interoperable smart contract platform that was built from the ground up to not only be extremely fast and scalable, but also highly customisable. Not only does it support the Ethereum Virtual Machine but it also has support for application specific sharding, network level programmability and non fungible tokens.
It’s a blockchain that its developers are hoping could eventually scale to Visa level throughput with sub-second finality.
💭 Current Consensus 💭
When it comes to establishing consensus in distributed systems, there are two broad consensus disciplines that have been used in the past.
Firstly, you have what is called ‘Classical’ consensus methods like Practical Byzantine Fault Tolerance (PBFT). These are based on all-to-all voting by the nodes in the network. There can not be a single chance of disagreement on the state of the blockchain by any of the nodes.
Then came the Nakamoto consensus with Satoshi Nakamoto. Unlike with the classical approach, an agreement on the current state of the blockchain does not have to be 100% correct all the time across all nodes.
💭 Avalanche Consensus 💭
The consensus mechanism works by repeated sampling of the network. Essentially, each node will query a small constant sized and randomly chosen set of neighbors about the current state of the network. If at any point there is a supermajority of these neighboring nodes that supports a different value, then the node will switch.
The term for this is network “Gossiping”. The nodes will Gossip with other validators about the validity of the transactions that are being proposed on the network. They can increase their confidence that they are about to submit a valid transaction record by polling the other nodes.
This system as described gets Sybil protection through proof of stake. The chance of a certain validator being selected is proportional to the stake that they have in the network.
🖥 Avalanche Platform 🖥
The Avalanche platform introduces this concept of “Subnets” or Subnetworks. Basically, these are a dynamic set of validators that work together to achieve consensus of the state of a collection of blockchains. They are required to create their own custom incentive mechanism for their validators.
If it is a completely permissionless subnet then validators can decide which subnets they would like to join. If a particular subnet does not apply to them then they can just avoid joining it. This means that you can reduce transaction bloat.
📈️ AVAX Tokenomics 📈
AVAX is the native token that powers the avalanche ecosystem. It secures the network, pays for fees, and provides the basic unit of account between the multiple blockchains deployed on the larger Avalanche network.
You have a total supply cap of 720 million AVAX tokens. The Genesis block that was initiated on Monday had an initial supply of 360 million tokens.
The reward rate is not a fixed parameter. Those that govern the ecosystem (token holders) can choose the rate at which AVAX reaches that capped supply. This makes it much more robust than a number of other protocols that have a set and forget inflation schedule.
For the first year of the mainnet launch, there is expected to be staking returns that range from between 7 to 12%.
📜 Disclaimer 📜
The information contained herein is for informational purposes only. Nothing herein shall be construed to be financial legal or tax advice. The content of this video is solely the opinions of the speaker who is not a licensed financial advisor or registered investment advisor. Trading Forex, cryptocurrencies and CFDs poses considerable risk of loss. The speaker does not guarantee any particular outcome.
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