Avalanche Subnets - The Next Growth Engine in Crypto?
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Avalanche Subnets - The Next Growth Engine in Crypto?
Everything to know about Subnets and Avalanche's Multiverse Announcement
Welcome to the alpha please newsletter. I curate alpha for you. That’s it; that’s the newsletter.
It’s time to explore Avalanche Subnets. It’s a very timely topic, as some rather big news came out today. I’ll do my best to give you a rundown, but as always, you have to dig deeper anon.
What’s to come?
What are Subnets?
Great Subnet Overviews
Accelerating Subnet adoption - Big
Subnet projects
CT Commentary
How do Subnets impact the AVAX price?
Resources to learn more
What are Subnets?
A high level overview:
Subnets are Avalanche’s scaling solution.
They offer an out-of-the-box solution for companies, DAOs, individuals, or even nations to create their unique blockchain with completely custom parameters.
Subnets can be permissioned or permissionless, but most importantly, they are interoperable with other subnets.
Subnets utilise Avalanche’s Consensus protocols to provide a secure, globally distributed, interoperable and trustless framework offering unprecedented decentralisation whilst being able to comply with regulatory requirements.
Subnets can have their own token / fee structure. Developers may also choose to have staking and transaction fees paid in $AVAX, stablecoins, or their own token.
Avalanche aims to achieve true scalability by scaling horizontally with an unlimited number of subnets.
Great Subnet Overviews
If you are like me, then you might need to read multiple Subnet explanations in order to fully grasp the technology at play here.
I’ve picked out three threads that you should read, in the following order.
Bubba’s breakdown is a great simplified overview as a starting point.
Connor, the creator of Pangolin, which is a DEX built on Avalanche, talks in more detail about how Subnets work and the concept of horizontal scaling.
Crypto Seq wrote this up today in order to add more clarity on exactly what a subnet is.
Accelerating Subnet adoption - Big
Avalanche just announced an incentive program of $290M in order to accelerate the growth and adoption of Subnets.
The founder of Avalanche wrote up a nice thread on what this means for crypto adoption.
Luigi is the Head of Defi at Ava Labs and talks about the importance of subnets alongside the newly announced Multiverse campaign.
Subnet Projects
Because I like gaming and it seems like many gaming projects are choosing to build subnets, I’ve highlighted three notable ones:
1. Defi Kingdoms
DFK started on the Harmony blockchain, and after an explosion in interest, they have begun expanding to other chains. This project seamlessly merges P2E gaming with Defi, quite a feat. Users use the DFK DEX, LP pools, and purchase NFTs with in-game utility.
They announced their subnet today. The game’s token JEWEL will be used for all of the chain’s transactions, elevating JEWEL’s utility.
2. Crabada
Crabada is a play to earn game built on Avalanche. They recently announced the long-awaited arrival of their subnet, the Swimmer Network.
Swimmer Network is a dedicated blockchain for gaming that leverages the existing infrastructure and security of the Avalanche Network.
Crabada decided their in game currency $TUS would be the gas token on the Swimmer Network.
Validators are required to run an Avalanche Node, and stake $CRA on a time-lock validator contract for the duration of validation.
Validators will earn the balance of network fees after burning, based on the the weight of their staked $CRA.
3. Ascenders
Ascenders is a sci-fantasy, open world action RPG with a fully decentralized, player driven economy powered by Avalanche blockchain.
Ascenders combines a “Zelda: Breath of the Wild” overworld with an “Eve: Online” MMO economy.
Their ambition is to bring the world it's first true AAA crypto game.
Just look at the trailer, man. Seriously look at it...
Ascenders just raised $6.4M in Private Round co-led by Paramount Capital, Sino Global Capital, Three Arrows Capital, and Merit Circle.
Their team combines experienced, director-level AAA game devs together with experienced crypto professionals.
There are many more subnets that have been announced and 0xNinjas has you covered with this thread.
CT commentary
CT is always dropping alpha, if you know where to look.
More marquee names to come..
Subnets have the architecture to allow institutions to adhere to the regulations they need to in order to utilise DeFi.
With Crabada and DeFi Kingdoms leading the way, many more games could follow…
Comparing the speed of subnets to the Avalanche C-Chain.
Darren Lau connecting the dots…
Food for thought.
How do Subnets impact the AVAX price?
Subnets should create a lot more demand for the AVAX token. The more subnets the more demand.
This will come from new validators originating from subnets; not when existing mainnet Avalanche validators validate subnets.
There is a special Subnet called the Primary Network, which validates Avalanche's built-in blockchains. All members of all Subnets must also be a member of the Primary Network. In order to become a member of the Primary Network, one must stake some Avalanche tokens.
The upshot of the preceding two points is that all validators of all blockchains must also validate Avalanche's built-in blockchains and must have staked Avalanche tokens.
Resources to learn more
There is a Subnet show! And this episode is a one stop shop for everything Subnets.
Emin speaks about Subnets on The Delphi Podcast.
And that’s your alpha.
We launched a Discord channel
It is a space for all general crypto chat and will almost certainly contain alpha. It’s free to join, just click the image. As you may have seen on Twitter, I originally launched the discord channel to organise the lobbying strategy against HMRC in the UK, so it also has a dedicated section for that.
Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Do your own research.