As a result of disagreement on whether or not to meaningfully increase the transaction capacity of the network, Bitcoin split into two versions: Bitcoin Cash (BCH) and BTC.
Sirer expressed support for Bitcoin Cash, saying:
In contrast, Sirer criticized the approach taken by BTC:
I felt that one of the sides was bending the truth and saying things that were not scientifically correct in order to affect a particular change to the protocol.
They wanted to introduce that SegWit modification and certain economic subsidies and they weren’t honest with their users on that. Neither were they honest about the limitations of the Lightning Network, and it’s only now that people are starting to realize that Lightning Network is limited in capacity.
Looking towards the future, AVA improves the areas that led to the Bitcoin scaling debate. AVA uses a new consensus protocol named Avalanche that provides high throughput. Describing Avalanche, Sirer stated:
It allows AVA to be much faster and to achieve finality in one second. It supports more transactions per second than Visa without compromising decentralization.
In another reference to AVA, Sirer enthused:
But when you come into the space with something that is three orders of magnitude faster, then it changes the whole game.
In the ForkLog interview, Sirer gave a brief overview of his work on cryptocurrencies over nearly two decades, and described how it influenced the AVA platform:
The Avalanche protocol represents the best of what I know, combining features from different projects and the lessons learned, pulling it all together in a new and very fresh approach to creating a value proposition.
The entire interview is worth a read with interesting views on the history and future of AVA, Bitcoin, cryptocurrencies, and blockchain technology.
Update: After this article was published, the AVA token was rebranded to AVAX. Original article below.
Here is what we know so far about the initial AVA token distribution.
There is a maximum supply cap of 720 million AVA tokens.
The genesis block will have 360 million AVA tokens when mainnet launches. The remaining 360 million tokens will be rewarded to network validator nodes over many years.
Overall AVA Token Distribution
Of the 720 million AVA tokens, here is the breakdown:
2.5% (18 million tokens) awarded to venture capitalist (VC) investors in AVA Labs.
10% (72 million tokens) rewarded to the AVA Labs team.
37.5% (270 million tokens) distributed to the community in a variety of ways.
50% (360 million tokens) rewarded to validators.
How much did Andreessen Horowitz (known as “a16z”) and other venture capitalists pay for presale AVA tokens?
VCs invested $6 million in AVA Labs seed funding to receive 18 million AVA tokens in the genesis block. Thus, VC investors paid approximately $0.33 per AVA token. These AVA tokens are subject to a lockup period.
Kevin Sekniqi, co-founder and COO of AVA Labs, confirmed this information in separate comments on Reddit [1, 2] where he stated, “2.5% of total token supply has been given to VCs” and “seed round got in at 0.33$ per token.”
Seven investors participated in the AVA Labs funding round, including a16z, Polychain, and Balaji Srinivasan.
AVA Labs Tokens
AVA Labs team members, including founders and developers, will receive 72 million AVA tokens.
To encourage long-term thinking, the AVA tokens rewarded to the AVA Labs team are subject to a four year unlocking schedule, starting from when the network launches.
AVA Labs will distribute 270 million AVA tokens to the community in the genesis block in a variety of ways:
At the peak of participation, at least 1,040 nodes concurrently staked testnet tokens to be validators in the Denali test network.
Participants earned up to 2,000 AVA tokens for completing three challenges, which included becoming a validator, participating in a network upgrade, and maintaining an operational node for at least 30% of the testnet duration.
The testnet itself continues to run, although participation is no longer incentivized through AVA rewards.
Participants can earn up to 2,000 AVA tokens for completing three challenges, which include becoming a validator, participating in a network upgrade, and maintaining an operational node for at least 30% of the testnet duration. The challenges end on June 15, 2020 at 11:59:59 p.m. UTC.
At least 1,037 nodes concurrently staked testnet tokens to be validators in the Denali network. However, staking funds to be a validator does not necessarily mean the validator node is actually up, running, and actively validating. A well connected node had 965 active peers on June 12.