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From $180 million DeFi incentive, look at Avalanche's ambitions

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DeFi is not a focus of Avalanche's pursuit, but rather a part of the overall grand plan.

原文标题：《 1.8 亿美金激励 DeFi，Avalanche 想成为区块链的下一个微信》

原文来源： Runchend，TalkChain

In a Brief History of Mankind, there's an interesting point. One of the most important twists in our ability to dominate the planet over other humans and species is gossip.

About 70,000 years ago, homo sapiens (our ancestors) developed the ability to gossip. It's a remarkable ability, and one that fundamentally changes the organization of human society. Hours of intensive exchange of information can help recipients find those who are truly willing to cooperate and screen out those who are not, so they know who to trust.

As a result, tribes expanded in size, classes and groups began to form within tribes, and humans developed closer and more complex forms of cooperation. The authors also point out that when human groups (such as a village) are smaller than 150 people, they can operate on gossip and develop their own unique systems of management.

Gossip is the behavior of "evaluating and sharing information with an absent third party" [1]. In the whole process of gossiping, all parties are in the situation of information asymmetry, and most gossiping is point-to-point, without going through a centralized node. Gossip is difficult to monitor and control, but it is highly effective in communication.

In other words, gossip is a very decentralized activity. It can propagate point-to-point, it is two-way (unordered in terms of propagation), but it can automatically "correct" consensus within small circles. The main problem is that gossip always causes a lot of trouble for the person involved.

From gossip to Avalanche consensus

The reason I started with gossip is because it's actually a mechanism by which human beings reach consensus. People agree (rightly or wrongly) on certain things or people during gossip, such as Runchen's good looks and money.

This is the Avalanche consensus of the Avalanche Agreement. Avalanche Consensus is a unique design independent of Satoshi Consensus (bitcoin consensus) and classic Consensus, and the most important part of this design is Gossip [2].

When a validating node receives a transaction, it randomly visits nearby nodes to gossip (also known as polling), and each node can only give a yes (Y) or no (N) decision. If everyone decides yes (Y), the consensus is reached and everyone goes on to gossip. If the result of the gossip is (N), then the node switches its decision to no (N).

Each node that receives the poll will actively gossip and exchange information with other nodes. Since such "gossip" is carried out and spread among different nodes at the same time, the whole network will reach a consensus on whether this time is or not within 3 seconds (after a certain number of nodes confirm, it can be considered to reach a consensus), and the transaction is (Y) or (N).

Interestingly, since Avalanche consensus has enough simple and efficient information in polling (only Y/N options), it doesn't have the kind of "slackness" or "gossip" often found in human society.

This is the most interesting thing about Avalanche consensus. Avalanche can accommodate a large number of consensus nodes (and have low performance requirements) and allow as many nodes as possible to participate in the consensus during the verification process, and be able to deal with some of the nodes' bad behavior. Ensure the efficiency of the entire network while sufficient decentralization.

From Avalanche consensus to ecology

Sure, Avalanche Consensus is a brilliant technological innovation. The Avalanche mainnet has 1033 verification nodes (as of this writing) and 12 subnets.

But I still hold the view that pure consensus is not the core advantage of a public chain competition. In other words, with the development of the underlying infrastructure of the public chain (especially the coming online of EVM compatible virtual machines and cross-chain Bridges), the role of the underlying consensus in the public chain competition seems to be becoming less and less obvious.

This is evident in this year's BSC centralization. With a rather centralized PoSA consensus and a centralized cross-chain bridge, but this does not affect the vigorous ecology and rapid growth of users on BSC.

So even though I talked to Professor Gun and boss John Wu of Avalanche, I didn't write this article about Avalanche. Because I always felt like one of the most important pieces of the puzzle was missing from Avalanche's ecological layout -- what exactly did they want to do?

In both Gun's and John's accounts, they both emphasize the Avalanche "subnet." Subnets are similar to Boca's parallel chains in that they share the security and speed of Avalanche consensus, but are scalable enough to allow developers to customize their own subnets.

Each subnet can have its own characteristics. For example, I can design a main network with an access permit that only non-U.S. users can access. Or I can design a main network for enterprises and add privacy computing to it.

Of course, these narratives now seem too grand and distant. Rice to a stutter, the public chain to a little bit of development. But in the whole narrative, I always felt there was an important missing link. When Avalanche Foundation released a $180 million DeFi reward program, I had an Epiphany.

An important part of this is that Avalanche wants to create a new financial platform that will allow more businesses to use blockchain. But whether it is the main network or the subnet, can not avoid a problem - What are the most important financial platforms?

The answer is assets and users.

It's not the technology that gets in the way. It's the users. We always think that with enough business use cases, they will bring enough users to the public chain, but maybe that's not the case.

That's exactly what Avalanche is doing. If we look at it another way, the whole puzzle is complete.

Avalanche has three chains -- X, C, and P. The P chain is responsible for maintaining the security of the entire network and creating subnets, the X chain is responsible for the issuance and trading of assets, and the C chain is the EVM compatible chain we usually use. We see dApps like DeFi running on the C chain.

So what Avalanche has to do is do everything possible to bring users and assets into the C-chain and keep them in the Avalanche ecosystem. When the subnet goes online in the future, users can easily use the services provided by various commercial organizations in it.

All platforms, there is a very core underlying logic, that is the user (traffic) is the most core barriers. The hardest part of the mobile web startup story is not once the user comes in, but how to get the user to download and install their App, which is often referred to as the acquisition cost.

Why wechat and QQ have dominated social software for so many years that nobody can shake them? Even alibaba, as powerful as it is, has struggled to get into the social scene. And wechat payment is very easy to take away half of ant Financial?

The core is the scenario and the user.

Wechat's scene and users are its biggest barriers. For Avalanche to build a new financial platform, it had to get its users there before anyone else and build enough scenarios to keep them there.

In my previous post, "Innovation Goes Right, And Users First," I shared two logic of starting a business. The magistrate chose the logic to the right, that is, the logic of the rise of the headline, to lower the threshold of users and then let users find the scene they want.

Avalanche option is the logic of left, which is also the logic of alibaba's rise. I find a strong enough scenario, I do the scene well, so that naturally can retain users.

The two kinds of logic have no superiority or inferiority, but the choice of the enterprise is different. From this point of view, everything Avalanche does makes sense!

First the $20 million Asian ecology fund Avatar was set up, and now the foundation is giving $180 million to Avalanche's DeFi ecology. It's all for one core purpose: to make the scene the best it can be and keep the user!

Why are you doing this? Only by doing so will Avalanche achieve its goal of coupling the business world with the blockchain world to become the new financial platform.

From blockchain to the business world

I think by this point, many readers have understood. DeFi is not a focus of Avalanche's pursuit, but rather a part of the overall grand plan.

The incredible scenarios Avalanche builds, and the people who stay behind because of those scenarios, will be the best incubator for Avalanche's entire business landscape.

To understand this logic, we only need to learn from wechat.

In the beginning, wechat was just a replacement for SMS because it was cheap and easy to use, just like people migrated to Avalanche now. It seems like a cheap alternative to Ethereum.

But what is wechat now? It is a payment tool, a financial tool, a transfer station for information acquisition, and even a search engine, a software platform. We open wechat more and more times, more and more behaviors are done in wechat.

In the future, Avalanche network will introduce more business scenarios with users as catalysts. This is exactly what the Avalanche team is good at. John spent 10 years as CEO of Sureview, a venture capital firm.

This is where I think Avalanche is most worth imagining. It has the opportunity to become a real platform, or the wechat of the financial industry, where there is a lot of capital and users are flowing freely (just like wechat's instant messaging function).

And traditional business (banks, venture capital firms, retail, credit, etc.) companies can also create their own scenarios based on subnets, like building "mini programs" on wechat. The people who are already in Avalanche ecology due to DeFi will quickly adopt and switch to these little programs. Subnets will also enable these commercial applets to implement more functions that are not available on other public chains, such as KYC.

So, what Avalanche was trying to do, I figured out now.

Take the road to the left of innovation, make the scene to the extreme, and become a new financial platform with tens of millions of users (or even more). Started with blockchain, loyal to business.

1. Gossip is the act of "judging and sharing information with an absent third party" from Robin Dunbar's Grooming, Gossip and the Evolution of Language;

2. More information about Avalanche Consensus: [Avalanche Consensus: Design, Evolution]