If you keep up with financial news on a regular basis, you must be aware that cryptocurrency is making the headlines almost every other day.
Anyone remotely acquainted with the internet or other similar technologies is taking an interest in it and wanting to know more. But, what has this popularity been driven by?
The growing demand for blockchain technologies has been largely aided by the security that they offer.
But that can’t be the only reason for its growth.
The world of cryptocurrency has been gaining a lot of traction owing to reasons like decentralization, low transaction fees, the potential for profit, and ease of technology.
Thanks to all these reasons, more and more people are now attracted to the cryptocurrency ecosystem.
Consequently, new cryptocurrency platforms are emerging to accommodate this rising interest. One such network is Avalanche.
In this article, we will be going over what Avalanche is, its brief history, how it works, and how to buy AVAX, its native token. Keep on reading to find out more!
Before we jump right into how to buy AVAX, it is important that you familiarize yourself with the platform that offers the token, Avalanche.
In simple words, Avalanche is a delegated proof-of-stake blockchain network.
Essentially, it is a consensus protocol that aims to solve issues regarding decentralization, scalability, and security.
However, before we fully grasp the consensus model that Avalanche has, it is crucial that we understand the consensus models that existed before it.
Before the era of blockchain networks, classical consensus methods like Byzantine Fault Tolerance and Practical Byzantine Fault Tolerance were wildly prominent.
Put simply, these consensus models were computer science algorithms that helped in bringing together a lot of things and coming to a conclusion using all the information available.
However, these models soon fell off since all the nodes on the network were compelled to know each other and no one could drop in and out of the network as they pleased.
They were permissioned networks where authority was consulted for decisions and with such high communication costs, scalability became a big issue.
Next in 2009, the Nakamoto consensus was introduced.
Now, this was a significantly better model since it was permissionless and had a greater scale with high levels of decentralization.
Finally, in 2020, the Avalanche model was put forward by Team Rocket. The Avalanche consensus protocol is largely different from previous models in several ways.
To begin with, the system is leader-less and no single authority is elected to run things.
No particular node is given more priority and every node on the system has an equal vote.
In essence, the Avalanche network is almost like a democracy that follows a mechanism called Sub Sampled Voting where random users have willingly participated in the network and are asked to verify transactions and other processes.
The network was designed to be an internationally distributed, secure, and decentralized platform.
The network is often called the “platform of platforms” since it leverages a one-of-a-kind protocol that combines three separate blockchains to build a permissionless and scalable platform on which developers may build. We will get into that later.
But, first, let us learn about the platform’s history.
History of Avalanche
Even though Avalanche was officially launched in the September of 2020, the project was in progress for several years before that.
The idea behind Avalanche was born in May of 2018 when a team of software developers who went by the name of Team Rocket wrote an article where they discussed the framework for the Avalanche network.
Not much after that, AVA labs was founded by Cornell researcher, Emin Gun Sirer, with an aim of developing and extending the idea of Avalanche.
The network held an Initial Coin Offering (ICO) in July of 2020 where they raised up to $ 42 million.
Since then, the platform has been amassing investments from several noteworthy organizations and has managed to build a lot of potential for the network.
How Does Avalanche Operate?
Admittedly, the underlying network of Avalanche is a bit more complicated than other blockchain platforms.
However, its level of sophistication makes it more advanced than its contemporaries with the help of three key features: its consensus model, its subnetworks, and the application of multiple blockchains.
We have already mentioned that Avalanche leverages three separate blockchains to build a permissionless and scalable platform.
We will elaborate on that more now. The platform has one primary network which has further been divided into three blockchains namely, X chain, C chain, and P chain.
- The first blockchain is responsible for the transaction, management, and creation of tokens on the network. This network is responsible for looking after the AVAX token, the native coin of the platform. AVAX is a cryptocurrency that is used to fuel transactions in the ecosystem. The AVAX token is used to share system incentives, engage in governance, as well as enable network transactions by making a payment.
- The second blockchain is built for smart contracts and is a replica of the Ethereum Virtual Machine. Using the C-chain, users can leverage the dApps on the Ethereum network on Avalanche. This allows developers to transfer their projects to new networks with little effort.
- Finally, the P-chain is the blockchain that is responsible for the management and coordination of validators and subnets on the network.
Subnets are nothing but the branched-out networks of the primary Avalanche network. Any user can build a subnet with a unique set of regulations.
Now, the fun part is that all these subnets can have multiple number of blockchains similar to the primary network of Avalanche.
Moreover, all those blockchains have the ability to have their own consensus model as well as virtual machines.
Additionally, they have the ability to choose whether they wish to be permissioned or permissionless. You must be wondering about the purpose behind this.
Sometimes, a company or an organization wishes to control a blockchain without establishing all the groundwork.
In such a case, that entity can just create a subnet in Avalanche’s network.
This eliminates the need of investing in a completely new tool. Moreover, as previously mentioned, the blockchains can have their own set of regulations.
This ensures that the organizations can bend those rules according to political and geographic requirements.
The last but definitely not the least feature that makes Avalanche so unique is its consensus model.
We have already briefly touched on it, but we will elaborate more here.
The avalanche network is closely built around the Proof of Stake model but essentially leverages a unique model with a different set of rules.
The network follows Sub Sampled Voting where random users have voluntarily participated in the network and are asked to verify transactions and other processes.
When any transaction takes place on the network, a random set of validators are consulted regarding whether that transaction should be rejected or accepted.
If the transaction is considered valid, something called “network gossiping” takes place where the validators exchange information and come to a conclusion.
How To Buy Avalanche (AVAX)
You already know by now that AVAX is the native coin of the Avalanche platform. Firstly, AVAX has a maximum supply of coins which is capped at 720 million.
Secondly, the AVAX token has a high value since it allows you to engage in governance on the network. That means, more AVAX coins equal increased voting rights.
As a result, more and more users are looking to know how to buy AVAX.
AVAX is available for purchase on several exchanges including Coinbase, Crypto.com, and Uphold, but it is recommended that you look for AVAX coins on Binance.
Binance, widely regarded as among the most trusted cryptocurrency exchanges, enables customers to quickly acquire AVAX.
Investors who want to acquire AVAX on Binance will benefit from reduced exchange costs and more liquidity, making it simpler to buy and sell swiftly.
In the following section, we will show how you can buy AVAX tokens on Binance.
Method 1: Purchase with Fiat Currency
If you wish to acquire AVAX coins, you can directly purchase them on Binance using fiat currency.
Step 1: The first thing you need to do is create an account on Binance.
Keep in mind that in order to register yourself on Binance, you are going to need to submit several important documents verifying your identity.
Carefully fill out all the details and register yourself on the platform. Once you are done with that, move on to the next step.
Step 2: Once you have created an account, log in with your credentials and head over to the section labeled “Buy Crypto” on the upper-left corner of the webpage.
Next, under the menu, tap on Credit / Debit card.
Under the Spend tab, choose USD or the currency of your country and under the Receive tab, search for AVAX.
After you have entered the amount of fiat currency you can afford to spend, enter your card details and tap on Buy.
AVAX coins will get sent to your Binance wallet immediately.
Method 2: Exchange Cryptocurrencies
If you do not want to directly purchase the AVAX tokens with your card, there is an alternative. You can trade some other cryptocurrency in return for AVAX.
You can either buy that cryptocurrency with your card or if you don’t want that, you can transfer that currency from some other address.
Step 1: Once you have funded your Binance wallet with the cryptocurrency of your choice, let’s move on to purchasing AVAX tokens with that.
Head over to the section labeled Trade on the Binance homepage. Under that, tap on Convert.
Step 2: Under the From tab, select the cryptocurrency that you want to exchange AVAX with. Also, enter the amount of that currency you are willing to spend.
Under the To tab, select AVAX. And then, proceed with the purchase.
Be certain to note the transaction fee imposed on the exchange. After you are through with checking everything, tap on Buy, and AVAX coins will be sent to your wallet.
Since its inception, Avalanche has come a long way and is predicted to have a bright future ahead.
We demonstrated what Avalanche is and how to buy AVAX in this blog so that you can acquire the highly potential cryptocurrency token with little hassle!
Can I Purchase AVAX on BitPanda?
Yes, alongside Binance, you can also use BitPanda to acquire AVAX tokens easily.