Research Summary
The report discusses the potential of Avalanche, a network that enables the development of on-chain businesses. It compares the growth of the internet to the potential growth of crypto, emphasizing the value of networks as they gain more users. The report also highlights Avalanche’s ability to adapt to new execution environments and its appeal to developers from various networks.
Key Takeaways
Comparison of Crypto and Internet Growth
- Exponential Value Growth: The report draws a parallel between the growth of the internet and the potential growth of crypto. It cites Metcalfe’s law, which states that networks become exponentially more valuable as more people join them. The internet grew from 16 million users in 1995 to 1 billion in 2005, increasing its value by more than 62 times.
Role of Avalanche in On-Chain Businesses
- Infrastructure for On-Chain Businesses: Avalanche is highlighted as a network that has developed infrastructure to support the growth of non-speculative, on-chain businesses. The report suggests that Avalanche’s infrastructure and tooling have evolved over the years, enabling the scaling of these businesses.
Avalanche’s Adaptability
- Adoption of Different Virtual Machines: Avalanche’s ability to adopt different virtual machines is emphasized as a key feature. This adaptability allows developers from various networks to deploy on Avalanche and ensures that Avalanche can adapt as new execution environments gain traction.
Real-World Applications of Avalanche
- Onboarding Applications with Real-World Uses: The report mentions that Avalanche is onboarding applications with real-world uses, making it easier for developers to deploy their own custom subnets. This includes software toolkits for rapidly building custom virtual machines and deploying subnets, games deploying on Avalanche, and institutions deploying their own custom subnets.
Avalanche’s Traction
- Gaining Traction in 2021: Avalanche first gained traction in 2021, with its C-Chain acting as a cheaper, Ethereum-compatible alternative. The Avalanche C-Chain is a general-purpose EVM chain, while other subnets could be permissioned, optimized for gaming, or use an alternative virtual machine.
Actionable Insights
- Monitor the Growth of Avalanche: Given Avalanche’s potential to support the growth of on-chain businesses, it may be beneficial to monitor its development and adoption rate.
- Explore the Potential of On-Chain Businesses: As infrastructure and tooling for on-chain businesses continue to evolve, there may be opportunities to explore the potential of these businesses and their impact on the crypto market.
- Understand the Impact of Virtual Machines: The adaptability of Avalanche in adopting different virtual machines could have significant implications for developers and the broader crypto ecosystem. Understanding this could provide insights into future trends and developments.
