Wrapped AVAX (Wormhole Solana)

WAVAX

WAVAX is a bridged version of AVAX on Solana. AVAX is the native currency of the Avalanche chain used for gas fees and security.

Risk Rating
Best
$37.38
0.67%
Summary
What we like
WAVAX is a wrapped verison of AVAX that enables it to be more easily used within DeFi. AVAX is the native blockchain token used to pay for transaction fees on the Avalanche network. All fees from network operations are burned to reduce the supply and increase AVAX scarcity for token holders.
What we like less
AVAX transferred through the Portal (Wormhole) bridge requires more trust assumptions as the bridge depends on external validators. The token supply schedule indicates a very high inflation rate over the near term which can have a negative impact on the asset price.
What it means for you
AVAX is a top alternative Layer-1 token with intrinsic value given its utility to pay for transaction fees, solid network usage, and strong value accrual through fee burning.
Information
Blockchain
  • Solana
Key Metrics
  • Volume (24H): $12.3M
  • ATH: $2,000.68 (12/17/2022)
  • ATL: $7.91 (12/12/2022)
Risk Assessment
Best
Asset Strength

WAVAX is a large-cap asset that represents the protocol`s native governance or utility token. This asset is exposed to the underlying risks of Portal (Wormhole) bridge, a protocol rated as Watch out.

Asset Tokenomics

WAVAX has a fixed supply. Every AVAX on Solana is backed 1:1 by AVAX locked on the Avalanche chain in the Portal (Wormhole) protocol.

Asset Volatility

WAVAX is highly correlated to the overall market.

Dependencies

Portal Bridge

Things to know about WAVAX

What is AVAX used for?

The AVAX token has two main use cases: to pay for gas fees on the network and for staking to secure the blockchain. The Avalanche network requires a small amount of AVAX to execute transactions on the blockchain. Validators on the network are required to stake AVAX to earn staking rewards based on the amount staked, duration, uptime, and response latency.

AVAX tokenomics

The total supply of AVAX is capped at 720M tokens. Of this amount, 50% were minted at launch and sold through private and public sales. The majority of these launch tokens are locked in vesting contracts between 1-10 years). The remaining 360M are reserved for staking rewards over the following decades. The reward rate is subject to governance as token holders can adjust the rate at which max supply is reached. Similar to Bitcoin, the reward rate will decreaes over time as it approaches its 720M supply cap.

How does AVAX accrue value?

All fees paid to execute transactions on the Avalanche network are burned, reducing the supply, and increasing the AVAX token's scarcity. If network demand is strong enough and the number of AVAX burned exceeds the amount minted via staking rewards, then the asset can become deflationary. Unlike Ethereum's EIP-1559 update in which only a base fee is burned, Avalanche burns all fees across its primary network. This deflationary effect will mostly be offset in the beginning by inflationary token emissions to reward validators.