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Avalanche or AVAX is a blockchain platform that is capable of running smart contracts. It is known for its high transaction speed, low costs, and eco-friendliness. It was created to deliver a highly scalable blockchain that doesn’t jeopardize decentralization or security. Here we are going to break through different aspects of AVAX. Stay with us to find the answers to your questions.

What Is Avalanche?

To understand the true Nature of Avalanche, first, understand the meaning of the word. According to Cambridge Dictionary and Merriam-Webster, an avalanche is a large mass of snow, ice, earth, rock, or other material falling quickly and suddenly down the side of a mountain.

Are you wondering why someone would name a blockchain after an avalanche? Because it is the fastest intelligent contracts platform in the blockchain industry. AVAX is considered to be an umbrella platform for trading and launching decentralized finance applications known as Defi. It was created to perform as a global assets exchange.

The founders and developers of Avalanche, Ava Labs, claim to have built the fastest smart contract blockchain platform globally. Avalanche aims to achieve the quickest time to final blockchain transactions. In Ethereum, it takes something about 1 minute for a transaction to be final. In Avalanche transaction will be final in one second.

How does Avalanche Works?

The main difference between Avalanche and other blockchains is that it is composed of three blockchains rather than one usual one. It was created to solve the problem of scalability. And it became possible to do so by distributing tasks among three blockchains. It allows Avalanche to achieve decentralization, security, and scalability.

Avalanche uses a unique proof of stake consensus mechanism to increase throughput, and it has reached over 4500 transactions per second, about 2x higher than Visa.

Users of this platform have access to the following features:


Platform Chain allows people to create L1 or L2 blockchain. People can also create a group of them. These blockchains are called subnets, and the P-Chain is included in all of them. The P-Chain keeps track of validators to manage the subnet.

Smart contracts are the core functions of Avalanche. Developers and individuals using this feature can create decentralized applications. Contract Chain is an Ethereum Virtual Machine or EVM that is responsible for running smart contracts in Avalanche.

Avalanche for creating and transacting uses Exchange Chain or X-Chain. AVAX as the native token of the platform is the most popular token as well.

What are Avalanche subnets?
Subnets are the short form of subnetworks. This feature allows users to create their blockchain. A subnetwork can be a single blockchain or a group of customized blockchains.

Once a subnet reaches its scaling limits, it creates another subnet to manage network traffic demands.

AVAX staking reward
Every subnet to manage the network requires validators who stake their AVAX tokens as collateral. Validators can earn up to 11 % Annual Percentage Yield or APY. It does not mean only the validator will get a reward for staking AVAX; you can also delegate your asset to a validator and earn a percentage of the staking reward.

Right now, investors stake something about 64% of the AVAX tokens. Delegators earn up to 9.53 % of the staking reward.

What problems does Avalanche solve?
Defi Has become so popular, and many users are leaving Ethereum due to the high network fees. The price of Ethereum increased; even investing in basic tokens has become so expensive. On the other hand, the gas price on Ethereum is so volatile, so many of the transactions will fail. In most cases, users lose hundreds of dollars without even executing the trade.

Avalanche, on the other hand, proposed a cheaper and faster solution. Generally, transaction fees on Avalanche Do not cost more than a few cents.

If you have been long enough in the cryptocurrency market, you know that scalability is one of the main problems of blockchains. Due to the increasing users and high activity, it is pretty normal to have a failure, as it takes more time to confirm a transaction in the network. To solve this problem, Avalanche uses three interoperable blockchains.

Avalanche transaction fee

As the Avalanche is the typical blockchain in the ecosystem, AVAX is the network’s default and native token. Traders use AVAX for paying transaction fees, and this is the common token between subnets. This token made interoperability possible. Otherwise, every subnet would use its cryptocurrency as the two prominent use cases of Avalanch is to create tickets and blockchain network. Developers using X-Chain will create custom tokens; later, they will launch intelligent contracts on the C-Chain. For creating subnets, they need to take care of payments through AVAX. So if you are interested in the Avalanch network, you need to buy AVAX.



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