In this discussion, Cryptocito hosts Patrick O’Grady, the head of engineering at Avalabs.
The main discussion was around Avalanche, the possible partnership between Avalanche and Cosmos, and Subnets.
Read our notes below to learn more.
Patrick O'Grady Introduction
Patrick O'Grady is the head of engineering at Avalabs and has been with the company for two years.
He previously worked at Coinbase for two years on the Rosetta API project.
Patrick's journey into the world of crypto started with a class on blockchain and Bitcoin at Stanford.
He joined Coinbase in 2019 in the middle of a bear market and stayed there until January 2021.
Patrick was drawn to Avalanche Network due to its ability to achieve finality quickly and the generality of its platform platforms.
He believes that Avalanche Network will be a key player in the next decade of crypto by empowering ecosystems to grow on shared foundations.
Patrick reflects on the evolution of the crypto space and expresses that his ideas have changed since 2014-2015.
He thinks interoperability will be the future of crypto.
Overview of Avalanche Ecosystem
The Avalanche consensus mechanism powers the entire network, including the EVM part and the two other chains in the primary network.
The Avalanche consensus is BFT-based (Byzatantine Fault Tolerant) and uses repeated sub-sampling to achieve fast finality and reduce network complexity.
Avalanche Consensus
The consensus mechanism consists of two algorithms: Snowman and Snowman++.
Snowman is the chain-based variant of Snow consensus applied to all chains and subnets.
Snowman++ is a proposal protocol decoupled from the finality gadget, which is normal Snowman consensus.
Finality occurs within 1 second of block production across the network and much faster on subnets.
Subnets in Avalanche
Avalanche is a blockchain network that allows users to create and participate in subnets, which are independent networks that operate within the larger Avalanche ecosystem.
Subnets can have any number of chains, but most subnets only have one chain for ease of understanding.
Subnets are a new concept in Avalanche and are somewhere between Polkadot and Cosmos in terms of abstractions.
Unlike in Cosmos, where validators can simply stake in a zone, in Avalanche, validators must be part of the primary network.
To create a subnet, validators must first be running on the primary network and have a minimum stake of 2,000 AVAX.
Creating a subnet involves staking on the network and having at least one validator staked.
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Functionality of Avalanche subnets
Subnets are opt-in, allowing validators to only participate in subnets that align with their interests.
Currently, validating the primary network does not provide any additional security to the subnet, and the subnet is considered its own sovereign network.
There are plans to implement a shared security feature at some point, which would allow subnets to interact with the primary network more seamlessly.
Popular applications on Avalanche
The top applications on Avalanche currently are Aave, Benqi, Trader Joe, and GMX, among others.
All of these applications are currently running as smart contracts on the C chain, as the majority of the liquidity of the network is on the C chain.
People are focused on making it easier to move between the primary network and subnets, as it is currently difficult to do so.
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Avalanche Warp Messaging
Avalanche Warp Messaging was released in late December and allows for subnet-to-subnet communication. It's primarily for subnet-to-subnet communication, where there is no overlapping functionality between the subnets.
Avalanche Warp Messaging is currently embedded in AvalancheGo (implementation of Avalanche for developers) but is not yet incorporated into the subnet EVM.
Interest in making subnets tangible
There is a lot of interest in finding ways to make subnets tangible, and there is potential for using efficient clients from a subnet for more than just connecting to different zones.
The aim is to make sure that the technical story around subnets is clear so that people can understand and potentially contribute to the development.
Integration of AVAX on Cosmos
There is an integration of AVAX directly on Cosmos, and there is an upcoming Twitter space with Luigi, who is the head of DeFi.
The integration is likely through Avalanche as it is the canonical bridge.
Distribution of AVAX
AVAX has a maximum supply of $720 million, and half of it was allocated as a security budget.
The current emission rate is around 6-7%.
Incentivizing validators and the end of the security budget
The network will continue to function as a platform of platforms, and staking will continue to happen on the primary network.
Over time, the reward mechanism for subnets will become more important than just the primary network.
At some point in the future, the tie-in to the primary network will be more about participating in the subnet economy.
The idea is to launch a sovereign blockchain without reinventing consensus and networking, and Avalanche is a good fit for that because of the generality of the subnet runtime.
To participate in the network, you have to be a part of the primary network because of the functionality that it enables, such as warp messaging.
Innovations in customer security
The discussion briefly touches on innovations in customer security, such as replicated security, interchange security, and mesh security.
The main idea behind mesh security is that if a virtual machine can produce proof of malicious activity, then participants can penalize the malicious activity by locking funds elsewhere.
Warp messaging is a low-level tool that can be used to implement mesh security by allowing validators to sign a message indicating that something happened, and anyone who reads the message can penalize the malicious activity.
Integration and Security of Subnets in Avalanche
Patrick mentions that the complex security ecosystem in Avalanche is applicable to subnets.
There is a desire for subnets to have shared security.
The speaker suggests that subnets could adopt some of the ideas around mesh security.
The end goal for security in Avalanche is to have a network of interconnected security chains.
The complexity of implementing a standard fraud-proof framework will be challenging due to the generality of the runtime.
Having a structured communication between virtual machines is important.
Interaction between Avalanche and Cosmos Ecosystems
Patrick mentions that there is a need for alignment on messaging specifications between the two ecosystems.
The development teams will be assembled in Istanbul in October.
Governance in Avalanche
There is currently no unchained governance framework in Avalanche.
The priority in the ecosystem is subnets that can communicate with each other, rather than governance and voting.
The consensus algorithm used in Avalanche is compatible with voting, but it hasn't been prioritized yet.
Avalanche’s Partnerships
The partnership between Avalanche and AWS is about bringing Avalanche to AWS's massive customer base and developing interesting tools together. AWS is interested in Avalanche because their customers have been asking for easier ways to integrate with it. The partnership is critical to helping enterprises adopt blockchain technology.
The partnership between Avalanche and TOGG (Electric Vechicle Company) is about using blockchain technology for all aspects of modern car architecture.
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