Introduction
ACP-77 is a groundbreaking community proposal set to revolutionize the creation and management of Avalanche Layer 1 (L1) blockchains. This initiative aims to enhance flexibility and autonomy for Avalanche L1 validators by eliminating restrictive requirements like mandatory mainnet validation and high staking thresholds.
Key Highlights of ACP-77
- Decouples L1 Validation: Validators no longer need to verify the mainnet or stake a minimum of 2,000 AVAX.
- Sovereign L1 Rules: Each Avalanche L1 can define its own validator requirements, enabling regulatory compliance and lower entry barriers.
- Dynamic Fee Model: Validators pay ongoing fees to the P-Chain based on network utilization, replacing fixed transaction costs.
- Institutional & Retail Benefits: Supports regulated entities and fosters decentralized validator participation.
What Are Avalanche L1s?
Formerly known as "subnets," Avalanche L1s are sovereign, application-specific blockchains tailored for diverse use cases. They enable:
- Customizable governance and consensus rules.
- Privacy-focused or permissioned frameworks (e.g., Evergreen upgrade).
- Cross-chain communication via Avalanche Warp Messaging (AWM).
Adopters include:
👉 Konami’s NFT platform and Intain’s tokenized securities platform.
Challenges Addressed by ACP-77
1. High Entry Barriers
Existing validators must:
- Verify the mainnet (C-Chain, P-Chain, X-Chain).
- Stake ≥2,000 AVAX (~$41,000 at current prices).
- Maintain high-end hardware (8 vCPUs, 16GB RAM, 1TB storage).
- Impact: Centralized validator sets hinder decentralization and long-term adoption.
2. Regulatory Constraints
- Institutions avoided permissionless mainnet validation due to compliance risks.
ACP-77 Innovations
1. Sovereign Validation
- Validators sync only with the P-Chain (tracking L1 validator sets and cross-L1 messaging).
Benefits:
- No forced mainnet validation.
- Lower operational costs.
- Regulatory-compliant L1s for institutions.
2. Dynamic Fee Mechanism
Validators pay ongoing fees to the P-Chain based on:
- Total registered validators.
- Network utilization (adjusts fees dynamically).
Purpose:
- Ensures economic sustainability post-staking removal.
- Balances accessibility with network load.
Why ACP-77 Matters
For Institutions:
- Operate permissioned L1s without exposing validators to mainnet risks.
- Align with regional regulations (e.g., data privacy laws).
For Retail Users:
- Lower staking/hardware costs encourage decentralized participation.
- More L1s → Diverse ecosystem growth.
For Avalanche’s Ecosystem:
- Scalability via horizontally sovereign L1s.
- Sustainable revenue for P-Chain services.
FAQs
1. How does ACP-77 reduce validator costs?
- Eliminates 2,000 AVAX staking and mainnet validation, cutting upfront expenses by ~90%.
2. Can Avalanche L1s still communicate cross-chain?
- Yes! AWM enables secure messaging between L1s via the P-Chain.
3. What replaces staking rewards for L1 validators?
- Validators earn fees from their L1’s native tokenomics (e.g., transaction fees).
4. Will dynamic fees spike unpredictably?
- Fees adjust gradually based on real-time network usage to avoid volatility.
Conclusion
ACP-77 marks a paradigm shift for Avalanche by:
✅ Unlocking sovereign L1 governance.
✅ Democratizing validator participation.
✅ Enhancing institutional adoption.
This proposal lays the foundation for a more scalable, compliant, and user-friendly Avalanche ecosystem.
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