What is Fantom?

What is Fantom?

Fantom is a decentralized and open-source smartcontract platform. It is one of many emerging projects that aim to solve the blockchain trilemma. The trilemma includes the problems of scalability, security, and decentralization. Fantom aims to solve these problems through their unique Asynchronous Byzantine Fault Tolerance (aBFT) consensus mechanism. Fantom claims its network can provide high levels of scalability and security while providing lightning-fast transaction speeds and a very low transaction fee. The transactions on its network take around 1 second on average and the transaction fee is $0.0000001.

With all of its great features, Fantom can become a hub for Dapps and DeFi applications. Their goals in the words of their team are;

“Be fast, highly performant and an open-source smart contract technology that can host multiple digital assets and Dapps”

In terms of its functionality, Fantom is competing with the likes of Cardano, Polkadot, and Solana. All of these projects each have their own unique way of solving the Blockchain Trilemma.

Who created Fantom?

Fantom was founded by Dr. Ahn Byung Ik. Dr. Ahn is a South Korean computer scientist, who is also the president of the Korea Foodtech Association. The Fantom team is currently being lead by CEO Michael Kong. He is well known among the crypto community for building one of the first Ethereum decompilers, and smart contract vulnerability detectors. The Fantom team is spread out globally and includes experts from various fields such as finance, cryptography, business development, and software engineering. Another well-known name in the team is Andre Cronje, who is the founder of Yearn, and a seasoned developer. Cronje has the designation of DeFi architect. The Fantom mainnet launched in the December of 2019.

How it Works?

The functionality that Fantom aims to provide is powered by its unique and ‘leaderless’ Proof-of-Stake(PoS) consensus mechanism called Lachesis. As mentioned earlier, it is an aBFT consensus mechanism. In an aBFT system, data can be processed at different times within the network. Furthermore, the network can also tolerate up to one-third of the participants engaging in malicious behavior and still cause no harm to the processes taking place on the network. Another key feature of Lachesis is that it provides near-instant transaction speeds. This means that transactions are finalized within an average speed of just 1 second. These incredible features single out Lachesis and its aBFT system as being much more secure, faster, and more scalable than both Proof-of-Work (PoW) and standard BFT systems.

If we take a closer look at the functionality of Lachesis, we discover that each network node has its own Directed Acyclic Graph (DAG). These DAGs are responsible for keeping a record of all the transactions that took place, as well as the chronological order of event blocks of that specific node. In Lachesis, each node achieves consensus independently, and then all these confirmed batches of event blocks are compiled into finalized blocks which are then confirmed on the wider Fantom network. All the independent nodes that are a part of this system can occasionally communicate with each other regarding transactions or events, however, they cant confirm finalized blocks or the overall state of the network. This unique setup enables lightning-fast transaction speeds. The PoS system of Fantom is leaderless, which means that there are no block leaders, nor do participants have a role in its operation. Hence anyone can join or leave the network, at any point in time.

The blockchain mainnet of Fantom is known as Opera. Opera hosts all the Dapps that are deployed on the Fantom network. It is an open-source and permissionless platform that can be used by developers to create and launch their projects on the network. Opera boasts a smart contract capability that is similar to that of Ethereum. This is due to the fact that Opera supports Solidity, which is the programming language used in Ethereum. Similarly, it also has an integration with the Ethereum Virtual Machine (EVM). This means that apps that are built on Fantom can be interoperable with platforms that are on Ethereum, while also having the transactional efficiency of Fantom. A Software Development Kit (SDK) is also planned to be released for Fantom-based development.

What is FTM?

FTM is the native token of the Fantom network. It powers the whole ecosystem, as it has multiple uses throughout the network. First and foremost it is used to pay the transaction fees on the network, hence all the transactions that take place on the network are powered by FTM. It is also the governance token, which means that its holders are granted voting rights in order to decide the future development of the network. Finally, it is used for staking and earning rewards through staking. The rewards are also paid out in the form of FTM.

FTM is available as a mainnet token, ie Opera FTM coins. In the Ethereum ecosystem, they are available as an ERC-20 token, and also as a BEP-2 token in the Binance ecosystem. The great thing about Fantom is that literally, anyone can participate in staking FTM with a minimum stake of 1 FTM. This can also be done by swapping ERC-20 or BEP-2 FTM tokens for Opera FTM coins.

Fantom network provides a very innovative and lucrative staking structure for its users. Users can stake their FTM, and receive a 4% annual staking reward. There is also a unique feature known as Fluid Rewards. Users can avail this feature by choosing to lock up their FTM for a predetermined time period. This time period can range from a minimum of 2 weeks up to a year and provides reward rates of up to 12%.

Concerns

The primary concern with Fantom, as with all other Ethereum competitors, is the high level of competition that they face. There are many notable projects like Cardano, Polkadot, Cosmos, and Solana that are well ahead in the race to become the next Ethereum. Compared to these projects, Fantom is still a newbie with its main net launching in December of 2019. Whichever of these networks manage to take off first, will surely spell disaster for the rest of them.

Another concern with Fantom is that although it has its ERC-20 and BEP-2 tokens, still its native FTM token is incompatible with all other wallets except its own PWA wallet. Another thing about FTM is that it can’t be staked on popular exchanges like Binance, but only on its own platform.

Where to buy FTM?

FTM can be purchased on major crypto exchanges like KuCoin — similar to how one would buy any other cryptocurrency. You can either place a market buy or a limit buy. With a limit buy, you determine the price you’re willing to pay, and your order gets filled once the token price reaches your set limit price. If you want to get your hands on the token quickly, you can place a market order, where you agree to pay the current market price and have your order filled almost instantly. If you are interested in trading FTM, you can do so by visiting KuCoin.