Avalanche (CCC:AVAX-USD) is a fast-emerging crypto and Ethereum (CCC:ETH-USD) competitor that promises to deliver fast transaction speeds. It is an advanced blockchain platform designed to overcome issues with older cryptocurrencies that inhibit their scaling abilities.
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Recently, AVAX crypto has moved up considerably as the market realizes its significance. For example, as recently as July 11, it was $10.705 per AVAX token. As of Saturday, Oct. 16, it was trading at $57.48 per token. So far this year, AVAX crypto is up almost 14 times.
Its market capitalization was $12.69 billion as of Saturday, according to CoinMarketCap, making it the 16th largest crypto on the market.
The Standout Features of Avalanche
The Avalanche platform processes 4,500 transactions per second. According to Decrypt, Bitcoin (CCC:BTC-USD) completes just seven transactions per second and Ethereum can only handle 14. AVAX can close a transaction within 3 seconds, whereas the Ethereum standard is up to 1 minute, according to Cointelegraph magazine.
As a result, the blockchain is suitable for large-scale applications. Additionally, Avalanche has much lower transaction fees than Ethereum.
This has had a huge effect on the crypto’s development by its sponsoring organization. For example, the Avalanche Foundation was able to lead a round of private capital fundraising.
According to Cryptoslate magazine, the Foundation was able to sell $230 million in AVAX tokens in June. The money will be used to help the Avalanche ecosystem grow and develop more uses as well as decentralized apps (dApps).
Another aspect that makes Avalanche crypto stand out is its ability to work with different blockchain platforms. Decrypt magazine calls this its “interoperability” feature. This is based on its tri-part architecture, where it is built on three different blockchains: the Exchange Chain, Contract Chain and Platform chain.
As a result, Avalanche dApps are compatible with Ethereum and other blockchains, even though it has the ability to close transactions on a faster basis.
Where This Leaves Avalanche
Avalanche is now moving into the fast-moving world of non-fungible tokens (NFTs). For example, Chicago artist Jason M Peterson has developed “mural” NFTs depicting Ye (formerly known as Kanye West) that can be independently verified by Avalanche.
Topps, the privately-held baseball card collection company, recently developed an NFT for 2021 Major League Baseball using Avalanche’s blockchain platform.
The Avalanche Foundation is now promoting the development of its blockchain through a new Avalanche Rush Program. It provides grants to companies and developers to come up with new dApps and NFTs.
This will likely lead to further adoption of the AVAX crypto in both the decentralized finance (DeFi) and NFT worlds. That will help push up the token’s price even further.
What to Do With AVAX Crypto
The growing popularity of AVAX has led Coinbase Global (NASDAQ:COIN) to approve trading of AVAX tokens as of Sept. 29. This will give the crypto greater exposure than it had when it was only available in minor exchanges.
Keep in mind, though, that this is a very speculative investment. Avalanche could fall out of favor, or develop problems that make it less viable when compared to Ethereum. That could create price volatility, so investors should be careful with this new crypto.
However, for those that are willing to put together a diversified portfolio of cryptos, Avalanche should be part of that mix. Given its lower costs and higher transactions speed, AVAX could be the next big crypto winner. Investors willing to tolerate a good deal of risk might want to take an initial stake in this crypto.
On the date of publication, Mark R. Hake held a long position in Ethereum but not any other security mentioned in the article (directly or indirectly). The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Mark Hake writes about personal finance on mrhake.medium.com and runs the Total Yield Value Guide which you can review here.