Cadenza Chronicle

In an era where blockchain platforms are all competing for a limited number of innovative and transformative projects, a few chains stand out from the pack.

The Avalanche Network (AVAX) is one such blockchain platform and we’re highlighting the reasons for its growing reputation as a “network without limits.”

Team Rocket

Looking back, 2018 was a paradigm shift for the blockchain industry.

In a global survey, Deloitte called the nascent technology “not quite ready for primetime, but getting closer to its breakout moment.”

This premonition turned out to be on the money, as the blockchain was indeed shifting from its early adopter phase to one capable of handling practical business applications.

At the same time, a few anonymous developers going by the pseudonym “Team Rocket” was conceptualizing a blockchain network that could meet the extensive requirements of the finance industry.

The team’s initial work would be built upon and eventually completed by a young team of researchers from Cornell University, led by computer scientist Emin Gun Sirer, who went on to release an open-source consensus protocol in March 2020.

This would become the Avalanche blockchain network and it has three major use cases:

• Application-specific blockchains, both permissioned and permissionless
• Decentralized applications (dApps)
• Complex digital assets (smart assets)

Here are a few examples of each:

dApps, DeFi Projects, and Smart Assets

Since there is no innovation or creativity without failure, it usually originates at the startup level and trickles up to big business.

So when JP Morgan wanted to become the first global bank to leverage the blockchain to offer innovative products, it turned to the Avalanche Network to do it.

One of the first initiatives JP Morgan built out was its Kinexys Digital Assets offering.

As an asset tokenization platform with the aim of helping other financial institutions unlock additional value from their assets, Kinexys needed a way to tap into the speed, scalability, and customizability of the blockchain without reinventing the wheel.

It accomplished this by connecting to Avalanche’s Evergreen Subnet, which is specifically designed to address enterprise-specific needs and customization requirements.

Since launching in 2020, Kinexys Digital Assets has tokenized several hundred million in alternative assets such as private equity, private credit, real estate, infrastructure, and has ramped up to process around $1-$2 billion in tokenized asset trading per day.

However, while Avalanche may be one of the premier blockchains for Decentralized Finance (DeFi), with many of the more than 500 apps on the blockchain being DeFi projects, it is far from the only use case.

Off The Grid On The Blockchain

Gaming is one of the most demanding tasks that can be put on a blockchain.

So when one game studio partnered with Avalanche to build the first-ever sovereign Layer 1 blockchain for gaming, it spoke volumes about its capabilities.

The developers of Off The Grid, a massive third-person shooter with 150 players on-screen simultaneously that is currently in early release needed a platform that is scalable, secure, and most importantly, low-latency for a smooth, uninterrupted gaming experience.

Looking around for the best possible option, Avalanche became the logical choice for several reasons:

• Scalability due to operating separately from the Primary Avalanche Network and other Subnets.
• Extensive customization options to tailor a sovereign network to your own requirements.
• Fast response times with over 100,000 transactions per second (TPS).

These advantages and others have attracted more than 100 games to Avalanche Subnets so far, with Off The Grid potentially being the biggest of them all.

Since launching in limited release in October, more than 7 million users have already played the game and conducted over 3 million transactions.

This has led the title to top most game store charts and even made longtime console and PC gamers take notice.

At the current pace, Off The Grid is poised for one of the biggest full releases for any game.

Creating Without Limits

This is the mantra of Avalanche.

And since securing funding of more than $360 million from the likes of Andreessen Horowitz, Polychain, and Cadenza, among others, the blockchain platform has scaled up to make it a reality.

Part of this has included striking up unlikely partnerships, such as with Amazon Web Services (AWS) and the California DMV, which is the first in the nation to digitize car titles using blockchain technology.

If you’re going to create a limitless blockchain environment, then the underlying architecture it is built on needs to be just as robust.

This is why Ava Labs built the Avalanche blockchain on serverless architecture on AWS, to ensure that it can deliver consistent performance and process thousands of transactions per second.

The setup also benefits developers who create Subnets today, by enabling them to just focus on creating their project, without having to worry about the tedious, backend architecture-building process all over again.

With a solid “built to scale” technical foundation in place, the future roadmap of Avalanche is likely to look something like the following…

Currently, the total value of all global assets stands at over $500 Trillion.

This is a conservative estimate, as many private assets have never been valued or appraised.

However, the tokenization of such assets into digital tokens on a blockchain, which JP Morgan, and others are leading the charge on, stands at only around $12-$13 billion today, or less than 0.002% of all global assets, by conservative estimates.

But as the amount of tokenized assets continues to increase, up to as much as 3% of global assets by 2030, Avalanche will be one of the primary beneficiaries of this megatrend, as one of the only blockchains with actual institutional adoption.

This isn’t the only catalyst either.

The Avalanche network is well positioned to take advantage of a few other major changes to the financial and media landscape.

The first of these is enterprises increasingly embracing the blockchain for both efficiency and security, with many opting to do this via AvaCloud, which already has more than one million monthly active users.

Avalanche is also fast becoming the premiere blockchain for gaming, with more than 100 layer 1 and 2 game projects currently active on the network.

Above all, the case for AVAX becoming a top five digital asset is an easy one to make.

If you found this insightful, you may also like Digital Assets for Everyone: How ETFs are Taking the Blockchain Mainstream or Inside the Base Ecosystem: Bridging the Gap Between Traditional Finance and DeFi

If you would like more information on our thesis surrounding the blockchain and other transformative technologies, please email info@cadenza.vc