Fantom Analysis
Decent DAO
0x9C62
February 18th, 2022

Fantom

In recent years, one of the main concerns in the decentralized finance (DeFi) space has been the scalability and performance of Ethereum amidst the prolonged transition to ETH 2.0. As a result, several Layer 1s have emerged, such as BSC, Avalanche, Solana, and Fantom — all of which are trying to prove that they are the most compatible and highest performing alternative Ethereum Virtual Machine (EVM) chains. Let’s focus on Fantom, deemed a high-throughput open-source smart contract platform for digital assets and decentralized applications (dapps). We are hearing more bullish optimism about Fantom than the rest amongst local degens, especially for NFTs (we’ve seen Fantom NFTs as many first-time crypto purchases). Plus, our bullish curiosity heightens when we see Andre Cronje and Sam Bankman-Fried of Alameda Research at the same party 🚀

Founded in 2018 by Ahn Byung Ik, Fantom is a fast, powerful, scalable, and customizable next-gen Layer 1 platform that uses a single consensus layer to support the creation of multiple execution chains. Fantom’s two core technologies are the Lachesis Protocol, the core consensus layer, and Opera, the application development layer. Lachesis utilizes Directed Acyclic Graph (DAG) scaling technology, allowing any computer connected to the network to process transactions in parallel. It combines Asynchronous Byzantine Fault Tolerance (aBFT) and Proof of Stake (POS). Lachesis has four main qualities:

  • Asynchronous: Participants have the freedom to process commands at different times.

  • Leaderless: No participant plays a “special” role in block production.

  • Byzantine Fault-Tolerant: It supports one-third of faulty nodes.

  • Near-Instant Finality: Transactions are confirmed in 1-2 seconds.

Opera is a secure and fast environment to build dapps, designed to overcome the limitations of older blockchain generations while maintaining compatibility with Ethereum for seamless dapp porting. It supports Ethereum’s Solidity programing language. One of Opera’s key competitive advantages is its transaction settlement finality of 1 second. Lachesis and Opera, the two main divisions of the Fantom Foundation, are responsible for building the tools to support dapps and kickstarting the global adoption and usage of the Fantom blockchain-based technology.

Decent DAO is Giga bullish on EVM and very much focused on the cross EVM landscape. Fantom offers EVM interoperability given its EVM smart contract compatibility and dev-friendly dapp deployment features. Lachesis has a modular architecture for dapp customizability. Fantom creates a new blockchain each time a new project is deployed, which acts as its Layer 2 solution. Dapps depend on Fantom’s mainnet while maintaining their attributes, increasing scalability.

In terms of DeFi, Fantom has a flourishing ecosystem complete with its own protocols and cross-platform integrations. Fantom.Finance is the first DeFi stack built on an aBFT consensus. On Fantom.Finance, you can use your FTM to mint fUSD and access the DeFi tools. Moreover, you can use fUSD to trade synthetic assets, lend to earn interest, and borrow synthetic tokens. The Fantom fWallet is a Progressive Web App (PWA), making it easy to launch on all platforms. Overall, 40+ projects have deployed their dApps to Fantom, including innovative application providers and protocols that support Fantom’s pioneering work in DeFi (e.g., Sushiswap, CREAM, Curve). Speaking again to Fantom’s interoperability, multichain.xyz acts as a cross-chain bridge based on Fusion’s technology that is integrated with Opera and other chains. For example, you can transfer ERC-20 tokens from ETH or BSC to Fantom network and vice versa. Fantom has billions in TVL, hovering around #3 to #5 in terms of top DeFi protocols on Ethereum. It has 2 million active addresses and, of course, notable active developers and advisors.

Fantom focuses on the main problems of speed, security, and scalability. Its unique, innovative approach to consensus via aBFT enables asynchronous processing of transactions for increased speed and throughput. However, Fantom believes it also solves decentralization effectively. Lachesis creates the ability for multiple blockchains to be connected to Fantom’s consensus protocol, therefore enabling secure and decentralized operational efficiency across Fantom. Lachesis is capable of scaling to many nodes around the world in a permissionless, open environment, providing a good degree of decentralization. It does not use Delegated Proof of Stake and has no concept of “Masternodes.” From a broader EVM perspective, Fantom’s innovative DeFi offering promotes the sharing of ETH mainnet’s operational load. Spreading usage from ETH mainnet to Fantom should promote an overall smoother experience for ETH mainnet users. Economically speaking, Fantom creates competition, personality, and differentiation in the EVM network to maximize distributed participation. It offers secure and scalable diversification for DeFi users. Moreover, Fantom provides broader EVM research and development considering Fantom’s $370M FTM incentive funding program for development.

Notable use cases for Fantom beyond the Fantom.Finance features include blockchain gaming, music, streaming, and micropayments. The Fantom Foundation blog also reports on Fantom’s pursuits in smart medicine as seen in Afghanistan and the Middle East. Our opinion: we foresee Fantom continuing to capture significant new DeFi user market share, even carving out a niche user base in the NFT space. The transition of more experienced DeFi users might be slower because crypto users tend to get comfy (i.e., Matic or other earlier layer 2 users). However, with Cronje creating hugely innovative NFT mechanisms, such as Solidly and Artion—on top of the firsthand experience of new users being attracted to Fantom simply because it’s cool, new, exciting, and delightful—we see Fantom continuing to capture a significant slice of DeFi market share. If ETH 2.0 does come out, then it’s up to ETH 2.0 to sell itself to the comfortable users of Fantom and the NFT, metaverse, and play-to-earn communities that have grown in the meantime.

Finally, here is a synopsis of the recent updates on the Fantom Network:

  • Solidly exchange launched

  • Artion v2 is live at artion.io

    • “Trade without platform fees on Artion”

    • Easy Connect, Super Fast, Low Transaction Fees, Zero Platform Fees

    • V2

      • Improved interface, filtering, performance, security, accessibility, graphQL API support, ERC2981 support, Golang backend

  • Stader Labs brings liquid staking to Fantom

    • Allows users to use sFTM to mint liquid staking tokens with cross Fantom DeFi landscape functionality to earn additional yield

  • DappRadar and Zen LedgerIO now support Fantom

    • Track trading volumes, user numbers, TVL, and other stats with DappRadar

    • Organize the chaos by calculating taxes and generating required tax forms with ZenLedger

Sources:

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