What is Fantom?
A guide to this powerful blockchain platform.
What is Fantom?
First of all, Fantom is a product of the Fantom Foundation, an organization led by Michael Kong, CEO/CIO, and composed of engineers, scientists, researchers, designers and entrepreneurs, distributed around the world and who have experience with blockchain development across the entire stack technology.
Briefly, we can say that Fantom, like the Ethereum network, is an infrastructure network in which many products can be run and built. Fantom is a scalable and secure blockchain network, which serves as an infrastructure for decentralized applications that provide solutions in many vertical segments. Blockchains built on the Fantom infrastructure are always fast, secure and highly scalable. Fantom is powered by Lachesis, an aBFT consensus algorithm based on advanced DAG.
Now let’s take a look at how it works and what are the advantages of this protocol.
Blockchain networks are managed by protocols, which are the heart, the engine behind these networks. Fantom is powered by Lachesis, an aBFT (Byzantine Fault Tolerant) consensus algorithm, far superior when compared to the Classical and Nakamoto consensus, being faster, more scalable and more secure than these protocols.
Lachesis has the following characteristics:
- Asynchronous: participants are free to process commands at different times.
- No leader: No participant plays a “special” role.
- Byzantine Fault-Tolerant: Supports one third of failed nodes, including malicious behavior.
- Final: the result of Lachesis can be used immediately. There is no need to wait for lock confirmations; transactions are confirmed in 1–2 seconds.
Each Lachesis node stores a local acyclic directed graph (DAG) composed of event blocks, each of which contains transactions. Each one of these blocks is divided into confirmed and unconfirmed event blocks. New event blocks are unconfirmed, while event blocks from the past 2–3 + frames are all confirmed, and subsequently ordered by honest nodes.
Consensus results in batches of confirmed event blocks, where each batch of events is called a block. Finalized blocks forming the final chain are calculated from event blocks independently on each node.
Lachesis nodes don’t send blocks to each other. Only the events are being synced between nodes. Validators don’t vote on a concrete state of the network, they periodically exchange observed transactions and events with peers. In addition, Lachesis doesn’t use new events in the current election, instead, new events are used to vote for the events in 2–3+ previous virtual elections simultaneously. This leads to a smaller number of created consensus messages, as the same event is reused in different elections. Hence, Lachesis achieves a lower time to finality and a smaller communication overhead compared to synchronous BFT.
Lachesis is also compatible with ABCI, meaning it can be used in other chains as ‘plug-and-play’, such as Tendermint does, and thus Lachesis can be fully integrated into other blockchains as a separate consensus module.
Existing Ethereum DApps can be easily migrated to Fantom, as developers, through Ethereum Virtual Machines (EVM), can use smart contracts in Fantom, since Lachesis is fully compatible with EVM.
Lechesis is also full compatible Cosmos SDK, therefore developers can use this consensus mechanism as a base layer and use the Cosmos SDK on top of it. A fully-fledged, proprietary, open-source SDK called Fantom Virtual Machine is in the works and will be released soon.
The table below compares Fantom with networks like Bitcoin, Ethereum and Tendermint.
While Bitcoin has an transaction finality of 60 minutes or six confirmations, Ethereum has 6 minutes or 25 confirmations, Terdemint round 6 to 7seconds, in Fantom a transaction is considered finalized and settled in less than 2 seconds.
Fantom experiments show that it can achieve up to 10k TPS, that is achieved on separate AWS nodes running medium specs.
Another big advantage of the Fantom network compared to Bitcoin and Ethereum is its low transaction fees, which are very cheap at $0.000001 per transaction.
Opera is the Fantom mainnet that went live on 27 December 2019.
Opera is fully permissionless and open-source (Fantom GitHub), a secure and fast environment to build decentralized applications.
Thanks to Lachesis, Opera is compatible with the Ethereum Virtual Machine (EVM) and provides full support for smart contracts through Solidity or Vyper, with higher speed, fast finality, increase of scalability and security, with no risks of congestion or long confirmation times as Ethereum network.
Opera is the best solution for real-world applications, allowing organizations, businesses and individuals to develop decentralized applications.
Opera, unlike most PoS platforms, is a leaderless Proof-of-Stake, which means that validators do not determine which blocks are valid, which causes its security to increase substantially.
Fantom Token — FTM
Here is an analysis of the different FTM tokens currently in circulation
1. Opera FTM: Used on Fantom’s mainnet Opera Chain
2. ERC20: Exists on the Ethereum network
3. BEP2: Exists on Binance Chain
FTM ERC20 and FTM BEP2 tokens can’t be used directly on the Opera mainnet. But when you send your ERC-20 or your BEP2 to your Fantom Wallet, they will automatically be swapped to Opera FTM token.
The Fantom wallet is a mobile and desktop wallet where you are able to create a new wallet, restore an existing wallet or connect your Metamask wallet. A Ledger plugin is still in development.
In order to do it, just go to the “Receive” tab of your Fantom wallet and pick Ethereum or Binance Chain and send your tokens (ERC20 or BEP2) to the respective displayed address. Your tokens will be automatically swapped to Opera FTM which allow you to stake and vote.
A similar process is required to send your tokens stored in your Fantom wallet to an external address.
The FTM token plays an essential role in the Fantom ecosystem and has different use cases, such as.
- Securing the network
As Fantom is a Poof of Stake platform, each holder can contribute to the security of the network, either as a validator or delegating their tokens to a network validator. We will talk about this later.
- Paying for network fees
Every action performed within the Fantom network costs a small fee, that is paid using FTM, compensanting validators for their services and prevent transaction spam.
- Voting in on-chain governance
FTM is also a governance token, which is why validators and delegators vote on network parameters, such as block rewards, technical committees and other decisions. Each FTM held by an holder is equivalent to one vote.
- Additional use cases
FTM is used as a collateral on the Fantom DeFi suite, discussed in details below.
Staking and Validators
A holder with at least 3,175,000 FTM can run its own validator node to earn epoch rewards and transaction fees. Validators earn staking rewards and a 15% fee on delegators rewards. In order to run a validator node on Fantom’s Opera Chain, in addition to the minimum FTM in the wallet, the followings are required:
- AWS EC2 m5.large instance (or equivalent)
- 800GB of disk storage (or equivalent) as the minimum recommended hardware specifications.
Here is a full guide on how to run a node: https://fantom.foundation/how-to-set-up-a-fantom-validator/
If you have at least 3,175,000 FTM but do not have technical skills, there is also an easier way to run a validator node, using ablock.io, just follow the step-to-step guide: https://ablock-io.medium.com/launch-your-fantom-validator-in-2-minutes-809604fb60
You will be able to launch your Fantom validator in only 2 minutes.
If you do not have the required minimum FTM in your wallet, you can still collaborate with the network security, being able to delegate your tokens to a validator (while maintaining full custody of your funds) to receive staking rewards. Validators charge a small fee for their services. You can stake on Opera with a minimum of 1 FTM.
Fluid Staking is the new staking model of Fantom, voted by FTM holders and allowing the maximum flexibility for stakers. You can choose a longer lockup (up to 12 months) to maximum rewards, or a shorter lockup (two weeks) or no lockup at all for a lower return rate. So, you have the maximum flexibility with your staking. The rewards on Fantom are dynamic and decrease as the staking participation increases.
So you can:
- Stake-as-you-go: earn the base rate, and your capital is always unlocked. You’ll be able to claim your rewards every few epochs. APY: 4%
- Lock up your funds for any time you choose, from a minimum of two weeks to a maximum of one year. You’ll earn rewards proportional to the time you decide to lock up your delegation, up to a maximum of 14% for the annual lock. In this case, you’ll be able to claim your rewards every few epochs.
30% of the rewards will remain locked to cover potential early unlock penalties and become available once the lockup period expires.
The maximum lockup period available for you depends on the validator you choose. Validators can choose how long to lockup their FTM as well, up to a maximum of 12 months. If the validator you chose isn’t locking up their FTM, you will only be able to stake as you go, with no lockup and 4% APY. If the validator you chose is locking up for three months, for example, you’ll be able to lock up your FTM for three months maximum.
You can unlock your stake at any time. In that case, you’ll pay a penalty that will be slashed from your locked rewards. Your initial stake and 70% of your rewards won’t be slashed, and you won’t lose any of your initial stake in any case.
You can stake your FTM tokens by delegating directly through your FTM wallet:
Fantom Vision is the blockchain explorer that makes use of our high-performance GraphQL API, with results in a robust and high speed explorer.
Fantom Vision shows validators’ identities, pictures and website links included, infinite scrolling on transaction and block pages, and an elevated focus on mobile usability.
Here is the current status of the Fantom network on November 7th:
Everyone is aware of the problems with the high gas fees charged for transactions on the Ethereum network and even Uniswap, where fees are lower, is not immune to this reality. Therefore, Fantom created fUNI, a Uniswap clone deployed on Opera.
Here are some of the advantages of fUNI compared with Uniswap:
- Lower fees: unlike Ethereum, fees on Fantom are a fraction of a cent.
- Faster transactions: transactions on Fantom are normally confirmed in less than 2 seconds.
Users can trade tokens on Fantom much faster and cheaper than on Ethereum, and provide liquidity with their fUSD (fantom stablecoin) and FTM tokens. Right now you can only trade fUSD and wFTM (wrapped FTM), and developers can deploy other tokens just like on Ethereum.
fUNI can be also accessed through your PWA wallet or at fUNI.exchange with Metamask.
With all the strength and interest that the DeFi theme has shown lately, it would be normal for Fantom also positions itself in this promising market.
Fantom Finance is the DeFi solution in the Fantom chain. It is a true DeFi experience, a feature-rich DeFi suite, that includes its own stablecoin — fUSD — and decentralized synthetic asset trading, lending and borrowing.
It is important to note that Fantom Finance is still under development and currently only FTM, fUSD and wFTM are available on the platform.
The platform is permissionless, composable, and interoperable, so anyone can expand it by:
- Building dApps on Fantom Opera
- Integrating Fantom Finance products on other chains
- Bringing other tokens to Fantom Finance
Through Fantom Finance, it is possible to do the following operations:
- Mint stablecoins: fMint function
On fMint, you can supply your FTM to mint fUSD, a token pegged 1:1 to the US Dollar. You can then use your fUSD to trade, lend and borrow on Fantom. To unlock your FTM, you only need to repay the fUSD you minted. In the future, users will be able to use staked tokens as collateral, earning staking rewards while making a portion of the amount liquid for other uses like lending, thereby increasing capital efficiency. Fantom have already made partnerships with other projects to offer their tokens as collateral, such as OKB, WAVES, ONT, TOKO, ETC.
- Trade synthetic assets: fSwap function
On fSwap, you will be able to buy and sell synthetic assets to gain price exposure to 176 tokens like BTC and ETH. Synthetics on Fantom track the price of an underlying asset via decentralized oracles. Synths are not limited by the availability of the asset, so they don’t suffer from liquidity issues. Furthermore, trades are executed at the target price without slippage. Using fSwap you can swap your FTM for wFTM, the wrapped version of FTM used in Fantom Finance (1 FTM = 1 wFTM).
Currently fSwap is only available for FTM/wFTM pairs.
- Borrow and lend: fLend funciton
On fLend, you will be able to lend your FTM, fUSD or synthetic assets to earn interest, or borrow funds to execute your favorite trading strategy.
Fantom Finance can be also accessed through your PWA wallet.
Fantom has already celebrated several partnerships and integrations in several areas such as DeFi, travel, medical services and real estate. Here is a list of such agreements:
- Oracles: Band Protocol and Chainlink
- Integrations: Okex, Ontology, Frontier, Ethereum Classic, COTI, Tokoin,V-ID, Suterusu, Waves and Fusion
- Travala, Gravity, Chekkit, House Africa and Seed Group
A separate chapter of these partnerships and agreements is the signing of a MoU (memorandum of understanding) with the Afghan Ministry of Health.
It is a pilot project to track 80,000 pharmaceuticals to prevent counterfeit drugs from harming people.
Fantom and Chekkit Technologies are behind this project, providing product authentication and supply chain tracking technology for the execution of the project. Chekkit, is an African health tech company, whose blockchain-powered anti-counterfeit solution is deployed on Fantom’s Opera network. Chekkit was finalist at the Fantom Blockchain Challenge held in Cape Town at the last edition of the AfricArena Summit.
Some of the features available in this project are:
- Serialization: The manufacturers will utilize Chekkit’s Consumer Intelligence solution where they get access to the unique product IDs (QR codes) that have been generated by the platform and stored on the blockchain network.
- Verification by regulators: Chekkit’s smart labels are made using special materials called taggants which can be verified using special hand-held devices. These devices will be used to verify the authenticity of pharmaceuticals by regulatory officers at their point of entry into Afghanistan as well as during in-store inspections of drug retail outlets.
- Verification by consumers: Afghans buying pharmaceuticals in stores can also verify the authenticity of drugs before they use them. All they have to do is scratch the Chekkit label on the product to reveal its unique QR code and just scan it using the Chekkit App. They can then see if the product is original or fake as well as other information on the product like its expiry date, registration number, etc.
- Data collection & analysis: When a product is verified, data like the location of purchase, time of verification, product verified, and so on, is collected and is made available to the product manufacturers in real-time.
- Trackable reward & loyalty campaigns: The product manufacturers involved in the pilot will be running a raffle draw for consumers who have bought and verified their products.
- Supply Chain Tracking (Track & Trace): Chekkit’s solution will be used to track the movement of pharmaceutical products from when they leave the warehouse and through every point in the supply chain.
Scalability, network congestion, high transaction fees and slow processing issues are known and affect many blockchains, especially Bitcoin and Ethereum.
Fantom, with its Lechesis protocol, solves all of these problems, bringing a secure, flexible, fast blockchain with very low transaction fees. Fantom is completely modular, with its protocol that represents a layer and can be plugged into any distributed ledger.
Within minutes, developers can port their existing dApps, write, deploy and execute smart contracts in a fast consensus engine. Fantom is still governed by its foundation, but in the future it plans to launch a governance smart contract that will allow validators and token holders to determine the direction of Fantom, as well as approve changes to the underlying consensus through hard and soft forks.
Fantom is the ideal solution for real-world applications, serving from traditional payment solutions, supply chain tracking, health data storage and more for new industries like DeFi.
Discord Discussion Group: https://discord.gg/6V42Gs8
Telegram Announcements Channel: https://t.me/fantomfoundation
YouTube Channel: https://www.youtube.com/c/fantomfoundation
Web Wallet: https://fantom.foundation/ftm-wallet/
iOS Wallet: https://apple.co/2UbNRdH
Android Wallet: https://bit.ly/2Ik2VDK
Fantom Finance: https://fantom.finance
Fantom Finance Twitter: https://twitter.com/FantomFinance
Fantom Explorer(Fantom Vision): https://explorer.fantom.network/