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The negatives of AVAX

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by COINS NEWS 135 Views

Wanted to invest in AVAX? Here are some negatives to consider, as I said before, we always need to search for the negatives. This will be a useful guide so you can search and further learn about AVAX negatives before buying in. An anti shill post so we make this sub more balance

1- First off, the poor tokenomics of AVAX. With an inflation rate of 220% in 2021 and 27% in 2022, it's not sustainable in the long run. Once it hits its supply cap, it'll have to rely on transaction fees, which may not be enough to maintain its value.

2- Avalanche lacks a slashing protocol, leaving malicious validators unpunished and posing a significant security risk for investors. But if you stake it means there is no slashing too so less chances of losing funds

3- Liveness is also an issue with Avalanche. While it has high security, it sacrifices liveness. The Liveness threshold for stopping the network is 20% bad validators, which means that a single organization can take down the entire network. This is a huge risk.

4- The consensus protocol is also quite complex and likely inefficient compared to BFT. While Avalanche Consensus was designed for DAGs, they forced a variation of it (Snowman) on the linear C and P chains. It requires 20 rounds of back-and-forth messages between nodes compared to 1 round for classical BFT.

5- The incentives for subnets are also not very appealing. They help with the security of the primary network but get nothing in return. To set up a validator to provide security to the primary network, you have to pay 2000 AVAX. The only benefit of building a subnet is that you get to rent Avalanche's existing validators, but it's not worth the risk.

6- There's stiff competition from other blockchains like Ethereum, Polkadot, and Cosmos. Avalanche doesn't offer anything significantly better than its competitors, and it's behind in market cap.

7- Avalanche's C-Chain only has a moderate throughput of 70 TPS, which is only slightly faster than Ethereum's L1. And while they boast about a 4500 TPS capacity, it's only applicable to the X and P chains, which are hardly used. This is not good news for those of us hoping for a more efficient and speedy network.

8- Lastly, let's not forget about the low adoption rate of Avalanche's C-Chain. It only gets 1/6th of the daily transaction count of Ethereum's L1, which is not a promising sign for its growth potential.

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