The Fantom project originated in South Korea but is now becoming popular among German investors and depositors from other European countries. It allows the decentralization of the blockchain, ensures the security of settlements within the network, and has no problems with scalability. Coins can be obtained through staking.
Fantom is not just a virtual coin but a decentralized environment for performing smart contracts. Creators of Fantom position it as an alternative to Ethereum 1.0, characterized by low transaction speeds and high transaction fees. Fantom cryptocurrency fundamentally differs from currently popular projects due to the Lachesis consensus, so it arouses interest among investors. The increase in demand can cause the price to rise and bring income to the coin owners.
How Fantom works
The main element of the platform is the Opera decentralized network. The main difference from the existing projects is the high speed of executing commands and processing many requests per second. The system outperforms Ethereum and many other blockchains on these indicators.
The “blockchain” consists of several levels:
- First is the core, which processes transactions within the system;
- second, the storage, which is necessary for the operation of smart contracts and other elements of the blockchain;
- The third is the ecosystem for running DApps.
The developers are particularly proud of the efficiency of transaction processing within the system. A transaction can be completed within 1 second, enabling payments to be made instantly. In comparison, a BTC blockchain transaction takes up to 10 minutes. Fantom’s competitor, the Polkadot network, performs a similar action in 5 seconds.
But the practical operation of Fantom showed that the actual speeds are lower than declared. The developers have declared about 300 thousand TPS but reached the maximum value of 10 thousand. Still, this is a record as compared to alternative projects.
What Fantom blockchain was created for
The Fantom cryptocurrency is a productive, high-speed system with open source code and the ability to work with smart contracts. This combination of properties allows it to be used for various tasks:
- Combining different platforms and blockchains into a single infrastructure, creating and running applications for fast, real-time data exchange.
- Creation of secure and functional applications solving various tasks in the telecommunications sphere, electric vehicle production, financial sector, and cargo transportation.
- Possibility to create coins and tokenized assets that will function based on Fantom.
Various decentralized applications have already been launched and are successfully operating in the project’s network:
- Cryptocurrency exchanges, which function without the management of the central administration;
- Services for investment, with the help of which it is possible to invest free funds, as well as to receive passive income;
- Wallets for storing cryptocurrency assets – among them https://fantomwallet.network/ is a specialized Fantom online wallet ;
- Decentralized channels, through which interaction between different blockchains, can be organized;
- Platforms for transactions with non-fungible tokens.
Features of the Fantom blockchain and FTM coin
The project under consideration differs from other blockchains in several important features:
- Fast transactions and low costs. For example, transactions within the system take up to 1 second to complete. At the same time, there is no high fee to make a payment. Therefore the network can be adapted for small payments between participants.
- Scalability. The system processes more than 1 thousand operations per second and works with decentralized applications that require the allocation of large quantities of resources. Up to 1000 nodes can be connected to the network.
- Security. Blockchain operates on a specialized consensus, which differs from classic PoW. All participants in the chain are equal and participate in its functioning. There are no central nodes that violate the principle of resource allocation.
- EVM compatibility. Fantom cryptocurrency is fully compatible with the virtual machine of the Ethereum network. Therefore, applications developed for Ethereum can function inside Fantom.
How and where to use
FTM token is used to settle within the ecosystem. It can be produced by staking, i.e., storing it in one’s wallet and ensuring validation of transactions. But unlike other options, you can stake this coin by placing an existing asset for a certain period (12 months). In return, the system pays a reward of up to 13%. The coin can be withdrawn at any time if no term is set. But the profit will be about 4% per year.
In addition, NFTs are used within Phantom. You can create new non-fungible tokens using applications that work in the ecosystem without paying a fee. This is done on the Action service. There is also a PaintSwap marketplace where you can sell and buy tokens (including NFTs).
What is Lachesis
The term Lachesis refers to the aBFT consensus developed by Fantom specialists. It is what makes the blockchain work with all the benefits described above.
Classic BFT refers to the blockchain’s ability to reach consensus and weed out blocks that contain invalid data or are hacked by hackers. The world’s first cryptocurrency, bitcoin, is based on PoW or “proof-of-work” consensus. To keep the blockchain working, complex mathematical calculations must be made; the crypto must be mined. However, cryptocurrency running on this consensus is slow, requiring a huge energy expenditure to keep the blockchain running.
Asynchronous BFT (aBFT) is an advanced verification algorithm that solves the basic problems of bitcoin and Ethereum. Phantom uses aBFT consensus based on a local acyclic graph (DAG). The system captures the relationship between events, allowing the order of transactions to be reconstructed. Therefore, nodes in the blockchain only synchronize events.
This approach also has disadvantages, but at the moment shows great efficiency.
The bottom line
Now Fantom cryptocurrency, despite its innovativeness, loses positions to more well-known currencies with high capitalization. But it has prospects and big ones at that. Especially in light of the recent trend to create CBDC or digital currency of central state banks of various countries.
There are already successful examples of such projects. For example, Ukraine is testing a digital hryvnia, which will function based on the Stellar blockchain. Therefore, FTM has every chance to show great growth.
