What is Fantom and how does it work
Fantom was founded by Dr. Ahn Byung Ik in 2018 who also served as the project CEO before leaving Fantom entirely in 2019. The Fantom project is now led by the Fantom Foundation, which was established in February 2019.
Fantom is different from the other networks. It is not using a blockchain, but a DAG.
In a blockchain each block contains data, but each block must also have one before, and one after it, that’s why it’s called a chain.
In a DAG, all the processing power is not consolidated on a single decentralized ledger, allowing even the users of its ecosystem to put in place their independent networks.
This has pros and cons:
- The transactions are confirmed very fast, up to around 4500 transactions per second, and these include basic transactions and smart contracts.
- Fantom is a scalable, customizable, and secure platform for smart contracts, designed to overcome the limitations of previous generation blockchains.
- Its modular architecture allows the complete customization of the blockchain for digital assets
- The consensus mechanism is also different: Fantom uses a special aBFT proof of stake model called Lachesis. aBFT is an algorithm that belongs to Byzantine Fault-Tolerant consensus and allows for honest nodes of a network to guarantee to agree on the timing and order of a set of transactions fairly and securely.
- You can delegate your Fantom coins to a validator that you trust, to take part in the dag. You only need 1 FTM to do this and you can start earning delegated staking rewards.
- Fantom is EVM compatible. This means that if you build something on the Ethereum network, you can copy and paste it on the Fantom network, with a few minor tweaks, and vice-versa.
- On the Fantom network, finality is around one to two seconds, and transaction costs are very low. You can lock up your $FTM to mint $FUSD which is a stable coin backed by phantom coins.
- Staking rewards are mostly going to developers. This is important because in this way, the network grows, and money will flow into the network consequentially.
- About governance, you can vote for a proposal, but you can choose how much you agree on a proposal, and you can vote from one to four, instead of saying yes or no.
- To attack the network and create fake transactions you only need to control around a third of the network which is much less than other cryptocurrency networks!
- When you delegate your FTMs, you must select a lock-up period from one day to one year, the longer you stake your tokens the higher the reward you can earn. It’s not really a bad thing, but it could be annoying from a user-experience point of view.
- To become a validator you need to stake at least one million FTM. This is impossible for most users and makes me worry about decentralization.
As you can see there are a lot of pros, and I like this network. The branding is very cool and spooky, the token has different use cases, like securing the network, payments, on-chain governance, and network fees.