If you haven’t heard of Avalanche during 2021 you must have been sleeping on your crypto investments. The Avalanche Layer 1 blockchain has experienced a meteoric rise in popularity and price alongside it’s growing on-chain ecosystem. To get to know your way around the Avalanche ecosystem, use its NFTs stake your AVAX, you’ll need the native Avalanche wallet. But the Avalanche wallet itself has some unique features that others don’t. So in this guide we step through how to access Avalanche wallet, how to use it without losing your AVAX, and some of the best dApps to get into on Avalanche.
What is Avalanche and why do you need to know about Avalanche?
Avalanche is a rapidly growing blockchain and crypto ecosystem. It bills itself as a network of blockchains with blazing fast speeds and better decentralisation (more validators) and scalability than other blockchain networks.Avalanche has a fast growing ecosystem with loads of DeFi protocols and dApps, tonnes of exchanges and swaps, as well as a growing NFT dApp presence. If you’ve been sleeping on your crypto Layer 1 projects, here are some fast facts about Avalanche:
- Avalanche’s Total Value Locked (in DeFi) has gone parabolic since August 2021. It’s grown from $300M to $11B!
- Avalanche’s total market cap is up 85% in the 30 days, hitting $23 billion at the time of writing
- Avalanche recently announced $600 million in funding to encourage development on its network. That equals more ecosystem growth.
- Avalanches native blockchain token AVAX is used for network fees, capped at 720 million, and burned (on creation of blockchains, assets, subnets and payment of transaction fees). If the AVAX burned is larger than AVAX rewarded (to validators) the tokenomics are deflationary.
It’s growing popularity and attention makes it a crypto project worth following and an ecosystem worth exploring.
What is Avalanche wallet and why would you use it?
Avalanche is the native wallet for the rapidly expanding Avalanche ecosystem. You might use Avalanche wallet to do any of the following:
- To stake your AVAX and earn rewards (you need a minimum of 25 AVAX to delegate for staking).
- To run an Avalanche blockchain validator node (you need to hold a minimum 2000 AVAX in your wallet to run a node).
- To mint and store AVAX NFT collectibles.
Staking and validating inside the Avalanche wallet earns attractive returns of between 9% and 11% depending on how the term you choose. Read this to learn more about staking and validating opportunities using Avalanche wallet.
Avalanche has a fast expanding NFT scene, with several new and popular NFT marketplaces. We look at the most popular Avalanche NFT dApps below. Avalanche wallet is where you mint and store NFTs for the Avalanche blockchain.
Getting started with Avalanche wallet
Avalanche wallet is a web wallet so you’ll need to be on a browser to use it. You can access Avalanche wallet here.
The first thing to do when you access the webpage is create a new wallet. The software will generate a seed phrase for wallet security for you. If you don’t know what a seed phrase is and why it’s important, check out our quick explainer here.
You’re going to want to write the seed phrase down (in order) so that you can recover your crypto if anything happens to your wallet.
The next step in creating your Avalanche wallet will require you to fill the missing blanks (words) in your new seed phrase – so make sure you don’t skip this first step or you won’t be able to complete the wallet set up process.
Once you’ve gained access to your newly created wallet, you’ll come to a screen that looks like this:
Before you complete any transactions you need to finish setting up the wallet security. There are two steps:
1. Set up wallet name and passphrase
Scroll down to the bottom left of the wallet ‘Portfolio’ screen and you’ll see an orange warning symbol. Click on this symbol to set up a name for your Avalanche wallet and to set a passphrase to access the wallet. You will need to use this passphrase to access the web wallet in future. It’s critical you do this to help with online security as the Avalanche wallet is a ‘hot wallet’.
2. Set up Avalanche wallet security
The next step is to set up your Ledger hardware wallet to secure any crypto you hold inside Avalanche wallet. Hot wallets are vulnerable to cyber hacking and theft. The best way to secure a hot wallet is by protecting it via a cold storage wallet connection.
The best cold storage wallets are the Ledger and the Trezor. To learn more about cold storage wallets, have a read through our article “Getting started with cold storage wallets: all you need to know.”
We review the top cold storage wallets here if you’re wondering which is best for you.
If you’re interested in a Trezor, Privacy Pros authorize dealer is a great site to get one from.
The great thing about Avalanche wallet is you can easily connect the Ledger cold storage wallet to it. You should do this before you put any funds in the Avalanche wallet.
Connecting ledger to Avalanche wallet
To connect your Ledger, you’re going to need to have the Ledger Live app installed and add both Ethereum and Avalanche wallets inside the Ledger Live app. You can add new wallets through the ‘Manager’ function inside Ledger Live.
Once you have Avalanche wallet set up inside Ledger Live, you can go to Avalanche wallet web version, select ‘Access wallet’ and select Ledger as the device you want to use to access your Avalanche wallet. After you confirm a few transactions on your Ledger, you’ll be given access to the Avalanche web wallet with Ledger security.
We recommending setting up Ledger wallet security for your Avalanche wallet BEFORE sending your funds to the web wallet. This way you’ll know your funds are secure.
4 unique Avalanche wallet features you need to know
Avalanche wallet is a little different from other wallets. You need to know how it’s different so you can use it fully, without worrying about losing your funds. Here are the main differences:
1. It’s three blockchains in one
Avalanche composes of a few blockchains together. So you’re going to need to deal with 3 different ‘chains’ inside the Avalanche ‘primary’ network. There’s three you will come across:
- X chain – Exchange chain – is where you first receive your funds (AVAX token) into Avalanche wallet.
- C chain – Contract chain – is where you find most of the decentralised finance applications.
- P chain – Platform chain – is where staking and validating takes place.
All three chains – X, C and P – can be accessed from within one place – the Avalanche wallet. Check out the rectangle in red on the right:
2. Your public address is different for each chain and changes with each transaction
Each of X, C and P chains have different public addresses. If you don’t know what a public address is, check out our crypto wallet FAQs here. It’s basically like a public facing email address for your wallet…
What this means is, to use Avalanche wallet you need to know which chain to use before you transact. Once you’ve worked this out, then click on ‘X’, ‘C’ or ‘P’ inside Avalanche wallet, to get the right public address.
- The X chain address starts with ‘x-avax’,
- the P chain address starts with ‘p-avax’ and the
- C chain address starts with ‘Oxb’ (like an Ethereum address).
Your public address on each of these chains will also change with each transaction. It’s an extra layer of security in the wallet. But don’t worry, because sending your crypto to an old address from a previous transactions will still get them to your wallet!
3. You send your AVAX to different chains for different uses
The Avalanche wallet ‘cross chain’ tab (see the red rectangle on the left menu bar above) allows you to transfer funds between X, C and P chain. You need to do this to use your AVAX for different things.
For example, if you want to stake AVAX token, you will need to send it from an exchange (where you bought it) to your Avalanche wallet using the X chain public address. You then use the cross chain tab (left of screen) to transfer your AVAX from X chain to P chain so that you can stake it.
4. Avalanche wallet is not set up for dApps
Avalanche wallet is not set up to interact with dApps built on the Avalanche blockchain, from inside the wallet. For that you will need to use MetaMask wallet, with the Avalanche C chain set up inside it.
To set up Avalanche C chain in MetaMask, you need to go to the Metamask menu (red square) and select ‘settings’, then ‘network’. From there, follow these directions to add C chain network to your Metamask.
How to get funds into the Avalanche ecosystem
There are two main ways to get funds into the Avalanche ecosystem so that you can interact with NFTs and DeFi products on the Avalanche blockchain.
1. Send funds to Avalanche wallet
You might send AVAX to you Avalanche wallet if you want to set up a validator node inside the wallet, or you want to stake your AVAX. Returns for staking are currently around 10%.
If you want to send AVAX or NFTs to your Avalanche wallet, you need to send them to Avalanche X Chain.
You can buy AVAX on Binance and send it directly to your Avalanche wallet on X chain. Simply open your Avalanche wallet, click on ‘X’ from the portfolio tab and hit the document icon to copy the address. You then past this address into the Binance ‘Withdraw’ screen and chose the ‘AVAX chain’.
If you are in the US, you can buy AVAX on Kucoin and send it directly to your Avalanche wallet for a small fee. Remember to select X chain.
2. Send funds to Avalanche network on MetaMask
You’re probably going to use Metamask if you want to use DeFi on the Avalanche ecosystem. If that’s the case, you’ll need to send your AVAX to Avalanche C chain.
You can send AVAX from Binance directly to C Chain – just make sure you select this network when you withdraw from Binance. The public address you send your AVAX to is the Avalanche network address copied directly from your MetaMask wallet. Remember you may have to add the AVAX token in your MetaMask for your token to show up.
Once you have AVAX in your MetaMask wallet, you can connect MetaMask to a growing number of dApps on Avalanche and start using their products and services.
If you are in the US, you can buy AVAX on Kucoin and make sure you select C Chain when sending your AVAX to your MetaMask wallet.
5 Best dApps to use on Avalanche
This Avalanche projects webpage is where you can find and explore the long list of many dApps built on Avalanche network. Here’s our highlights on some of the best dApps to use on Avalanche if you’re into DeFi, NFTs, exploring the metaverse or shopping with your crypto:
- Avalanche Bridge – you can use this bridge to transfer ERC20 tokens from Ethereum to Avalanche’s C-Chain and back. It’s fast and low cost to bridge to Avalanche. In fact, bridging to the Avalanche blockchain from Ethereum can be a cheaper way of executing a trade than doing it on the Ethereum network.
- TraderJoe – is a decentralised exchange to swap crypto quickly and cheaply. It also has lending, borrowing, liquidity farming products available. It’s probably the most popular dApp on Avalanche as we write and well worth checking out.
- Wonderland – DeFi staking dApp where you can stake $TIME and earn 86,000% APY at the time of writing. And yes, you read that correctly. 86,000%.
- Curate – DeFi Shopping App with AVAX Payments. You can also Mint and sell NFTs using the Curate gasless NFT Marketplace (charges 4% commission instead of gas fees).
- Kalao – There are 7 NFT marketplaces on Avalanche network all vying for what has become the hottest sector in crypto bar metaverse gaming. Our favourite is Kalao NFT marketplace where you’ll find the cool Party Animals NFT collection among others. Not as big as the ETH NFT marketplaces, but a lot cheaper to buy into, mint or swap if you’re just getting into the NFT scene.