How To Short Avalanche (AVAX)

    • James Page

James HeadshotAuthor: James Page - Last Updated on June 28, 2022

Summary: Shorting Avalanche is pretty straightforward, all you need is a crypto trading platform that allows for short selling. While there are a few exchanges out there that have added the ability to short crypto, our recommendation is to use eToro. They’re well-known, have a global presence, and are trusted by millions of users from 100+ countries.

We’ll be using eToro in our guide, you can sign up with one of the sign-up buttons below.

Global: Sign up with eToro

USA: Sign up with eToro US

Avalanche

Before we get started, let’s quickly explain what shorting is (for those that are new to it). Shorting is the practice of selling a cryptocurrency hoping it will drop in price so you can buy it back later for cheaper… which, if successful, will give you a net profit.

It might sound a bit complex but don’t worry, it’s a lot easier than you might think.

How to Short Avalanche

Shorting Avalanche can be done in 4 steps:

  1. Find a crypto exchange
  2. Sign up with the exchange
  3. Fund your account with fiat or crypto
  4. Short Avalanche

1. Find a cryptocurrency trading platform

As mentioned before, for this guide we’ll be using eToro as they offer the ability to short the most common cryptocurrencies.

You can, of course, use any other crypto trading platform that allows for short selling.

etoro crypto

2. Sign up with the crypto trading platform

Let’s start with creating an account on eToro.

Global: Sign up with eToro

USA: Sign up with eToro US

 

eToro sign up form

The sign-up process is very quick and easy, as is the verification that needs to be completed afterwards so you can get started.

3. Funding your account

Next is funding your account. You have several deposit methods to choose from when depositing funds into your eToro Account. These include a bank transfer, credit card, debit card, PayPal, and more.

4. Short Avalanche

These are the steps to follow to execute a short sell:

  1. Go to the search bar at the top, find Avalanche by entering the name.
  2. On the crypto page/section, on the right side, hit the TRADE button to enter the trading interface.
  3. At the top of the trading interface: Click on sell to short the crypto.
  4. Enter the amount for which you want to sell Avalanche and click on “Open Trade”.

Once you’re ready to close the trade, hopefully when the value of Avalanche has dropped, go to your Portfolio, find the Avalanche trade, and click on the red cross to close the trade.

If your assumption/prediction was right, then the profit will be added to your account after closing the trade. If you were wrong on the other hand, you’ll incur a loss which will be debited from your eToro account.

Congratulations, now you know how to short Avalanche!

Global: Sign up with eToro

USA: Sign up with eToro US

 

Disclaimer: Trading, investing, and dealing with digital and cryptocurrencies might involve a lot of risks. Their prices are volatile and performance is unpredictable. Their past performance is no guarantee of future performance.

Affiliate Disclosure: This site is supported by its users. We may receive commissions for purchases made through the links on our site. This does not impact our reviews, guides or comparisons.

 

Where to Short Avalanche (AVAX)

Aside from eToro, the other major exchange you can use is Binance.

While Binance tends to be a bit more advanced when compared with eToro, they do have a lot more digital assets to trade with.

 

Frequently Asked Questions

Can I short Avalanche on Binance?

Yes, you can short Avalanche on Binance. They have over 300 cryptocurrencies on offer, have a decent phone app and a lot of advanced trading features.

About Avalanche

Ava Labs designed the Avalanche cryptocurrency to avoid common blockchain issues like congestion and high gas costs. It uses three different blockchains to solve the core problem of this platform, instead of the standard one. Each of the blockchains was developed to fulfil vital tasks within Avalanche, rather than relying on only one.

Avalanche achieves three critical elements of a reliable and powerful blockchain. This is possible by dividing up the tasks amongst them: security, efficiency, and scaleability.

Avalanche Blockchain's unique structure allows for many benefits. The three-blockchain approach addresses many of the problems that blockchains face.

Interoperability allows you to trade and interact on other forms of cryptocurrency as well as data from other platforms. Avalanche is very interoperable because it allows you to create subnets with your blockchain as the common platform. This structure allows different blockchains interoperable with each other and allows them to share assets and data.

Only a few Blockchains are capable of accommodating this. Even fewer blockchains can do this with third-party tokens. They also need to ensure consistent throughput and avoid time compromises. Avalanche can be interoperable seamlessly, which allows it to improve the environment for decentralized finance (DeFi).

Interoperability offers another advantage: Scalability. Many of the other blockchains that are currently available are not scalable. Even those that are, they lose functionality when scaling. This issue is well-documented and long-standing for older blockchains.

Let's take Bitcoin (BTC) for an example. Each transaction requires enormous energy and computing speed to complete. Ethereum, on its other hand, can only process 15 transactions every second. These limitations make scaling these blockchains challenging.

Avalanche, however, was built to overcome this problem. Avalanche boasts more validators (TPS) than any other network and speeds up to 4,500 transactions each second (TPS). Avalanche blockchains have the potential to be infinitely scalable. The Avalanche blockchains are able to do this without compromising their decentralization thanks to their three-blockchain structure and interoperability across multiple blockchains.

Developers and new users have a lot of concerns about usability. They want to know how simple it is to adapt and implement Avalanche for various uses and applications. Avalanche has proved to be extremely user-friendly in numerous cases, for both casual traders as well as dApp developers.

Avalanche’s blockchain system allows users and organizations to deploy their L1- and L2 Blockchains. You can even create them privately (permissioned or public)! This is combined with a powerful proofofstake consensus mechanism that creates a stable, decentralized platform that developers can build on.

Its viability is evident in its flourishing ecosystem. Several products such as Pangolin (Prosper, Securitize and many more) are already using this blockchain. Hundreds more projects are planned for the future. Each of these dApps has its own blockchain that is hosted on Avalanche. Developers have complete control over how the blockchain functions and how it's secured.

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