Avalanche in a nutshell: this is very easy money for them. I'm going to explain the basics of this project as I see it, because under no circumstances would I ever again buy Avalanche. I bought Avalanche before and staked it, and I thought it was easy money. Surely it'll go up as an Ethereum killer, right? In my experience, it's crap. The more I researched it, the more I used it, and the more I found what other cryptos like Internet Computer were doing, the more I felt like they had ripped me off and lied to me. To me it looks like a small group of insiders created their own coin, not to add value to the world, but purely to extract value from me.
If you look at the price action, AVAX has totally sucked compared to the most manipulated, most fraudulent things in crypto, like Solana. That's not a good sign going into the next bull market. Every time AVAX gets pumped lately, people dump it right away. It pumped over 50 and got dumped right back down, and it still hasn't even gotten close to its all-time high from the last bull run. I'll grant that this price chart looks great compared to the ICP one. But let's go behind the scenes in Avalanche.
The numbers behind Avalanche
Let's start with the fastest blockchains by transactions per second. Look at Avalanche's fully diluted market cap: about $18 billion. That means they still have roughly $8 billion of token unlocks left to dump in your face. Oh yeah, what else do you like dumped in your face, Jerry? On blockchaincenter.net it's a top 10 blockchain if you exclude stablecoins. And what's the technology like? In my opinion, it sucks. What's the adoption like? It blows. Sucks and blows, those sound great together.
If you look at ICP, it is doing the most transactions per second, more than Solana all day, every day, and it is valued less than Avalanche. Just based on opportunity cost, I pulled all my Avalanche out of staking and put it into ICP, because look at what ICP is actually doing: more than Solana, more than anything else in crypto. And where's crappy old Avalanche? Down at around 25 transactions a second. The max ever recorded is 25,000 on ICP and 2,900 on Solana, and the max theoretical on Solana is way less than ICP. But look at dumpy old Avalanche: 123 transactions a second is the maximum ever recorded, with a max theoretical of about a thousand. To me it's a dumpster fire blockchain.
Now let's look at some more critical issues. Total value locked, TVL, was over $10 billion during the last bull market, and then it took a fat crap and flushed straight down the toilet. The main narrative that anything outside of Internet Computer Protocol has is built on these easily faked metrics like TVL and active users, which are simply manipulated by bots. And even Avalanche can't cheat anymore, or can't afford to pay to cheat its TVL the way Solana does. The TVL has never come back. The transactions have never come back to where they were before. And it keeps getting worse.
What I've heard about the tactics
I remember people from DFINITY saying that Ava Labs conspired to launch a whole bunch of class action lawsuits to try to slow down their competitors. That's pretty nasty. The sources I've heard are trustworthy, and what they told me is that Ava Labs hired paid lawyers to target and hurt competitors through direct lawsuits, also to keep competitors at bay. Now, this is not something I can tell you about firsthand, the way I can with the transactions, with the TVL metrics, with how big the market cap is, and with how many token unlocks there are still to come. I'm sharing it as something I've heard from people I consider credible, not as a fact I've verified myself.
The team tells the story
Let's look at another problem: the Ava Labs leadership team. You have two engineering founders, which is good, but then business development, general counsel, operations, more business development, the wallet, the cloud, another engineer, and a bunch more business development. What I'm seeing is a team with a handful or fewer of engineers and mostly business people. To me that's a sign that they're mostly doing business, not engineering. And look how small the team is: 12 people who show their faces, which is better than Solana, I have to admit. If you look at Solana, they don't even show their faces, they have four people listed in plain text. I guess they don't watch my videos, because at least Cathball watches my videos and makes updates when I criticize them. But for a project worth $18 billion, you get 12 people from Avalanche, and at least half of them are business people.
Now, what do you get if you're an ICP holder like me? You get DFINITY. Compare what Ava Labs shows versus DFINITY: the largest research and development team in blockchain, a massive number of engineers and PhDs, some of the most talented people in crypto. You look at their team, then you go back to Ava Labs, and it's like fielding a high school football team against the Chiefs, or whoever's good in football today. I think the Chiefs are in the Super Bowl. That matchup makes sense to me. A team this small, with these tiny transaction numbers, tells me the business development people aren't getting it done, because there's just not a lot of business happening on Avalanche. Not according to the data. They can't even fake the TVL anymore.
Why I sold and where I went
When I look at all of this, I don't see anything that looks good. This is easy money for them: they spend a little bit of money to create a blockchain, which to me looks like most of the technology was copied from open source. You can't build the kind of things on Avalanche that you can elsewhere, and I see no hope of that changing in the next several years. So what good is the blockchain? When you've got things like Solana with similar technology to Avalanche, but they've paid way more people off and they lie, cheat, and steal way harder, why would you put money into Avalanche when it can't even lie, cheat, and steal as well as Solana does? If you want to invest in liars and cheaters, at least invest in the best liar and cheater.
To me, if you want to make the world a better place, you should be using the blockchain every day before you invest in it. With ICP, I use the blockchain every day, and I used it every day for quite a while before I put my whole portfolio into it and sold my Avalanche. So yes, this is easy money for them, but I've come to believe it doesn't have to be. It's up to us in retail to make better investing decisions by doing real research, because in my view ICP should be valued way, way higher than Avalanche. I hope that someday, with your help, it will be. If you want to see how I think about all of this, I've put together my Money playlist. I did this live on Twitch, and I give money away constantly, directly on the ICP blockchain, by sending it on Twitch. Much love.