Deep Dive
1. Purpose and architecture
Avalanche is a Layer 1 blockchain, meaning it provides its own base network for applications. Its design separates tasks across three chains: the C Chain runs Ethereum compatible smart contracts, the P Chain coordinates validators and custom Avalanche chains, and the X Chain handles digital assets. This structure is intended to keep different kinds of activity from competing for the same resources. CoinMarketCap
Developers can also create customized Avalanche chains, choosing rules suited to their application. These can support uses such as decentralized finance, games, or digital asset services.
2. AVAX’s role
AVAX is used to pay fees on Avalanche’s Primary Network and to stake, meaning validators lock up tokens to help confirm transactions and secure the network. Transaction fees are burned, or permanently removed from circulation, while staking rewards are issued under network rules. AVAX has a stated maximum supply of 720 million tokens. CoinMarketCap
Conclusion
Avalanche is a smart contract blockchain built around separate core chains and customizable networks, with AVAX supporting fees and network security. How effectively can its custom chains serve applications that need their own rules?
