Fantom is one the fastest and cheapest blockchains to use and adoption has exploded since 2021, especially in the decentralized finance (Defi) industry.
This post will look at why I think Fantom (FTM) is a good investment that should be considered by any serious investor.
We'll also look at how the platform works and what sets it apart from other blockchain networks.
If you decide to invest in Fantom (FTM), I recommend using a cash-based exchange platform like Kucoin (Worldwide and USA users) or Bitpanda (Europe only) that allows you to easily buy and sell cryptocurrencies for cash.
What is Fantom (FTM)?
Fantom is a highly scalable, DAG based smart contract platform for decentralized applications (Dapps). The cryptocurrency for the Fantom network is FTM.
Fantom aims to solve the scalability issues of existing public distributed ledger technologies.
According to Fantom's whitepaper, they use DAG (Directed Acyclic Graph) technology due to the slow transaction times of typical blockchains like Bitcoin and Ethereum.
Fantom is positioning itself as a faster and cheaper alternative to Bitcoin (for money transfers) and Ethereum (for development platforms).
For example, on Fantom a money transfer takes only 1 second, whilst costing only $0.0000001.
Compare this to Ethereum where transactions cost $3 on average and take 15 seconds to 5 minutes. When the Ethereum network is congested both the fees and transaction times are much higher.
When compared to Ethereum, Fantom is 300 million times cheaper and 15 to over 300 times faster for money transfers, and that's only when the Ethereum network is running normally.
When the Ethereum network is congested, the savings when using Fantom (FTM) become even more astronomical.
During periods of high activity, fees on Ethereum can cost from $50 to over $300 and can take over 30 minutes to complete.
Fantom's native token FTM is used to for the following purposes:
- Staking - You can stake FTM to secure the Fantom network and receive extra FTM as a reward, generating passive income.
- Payments - FTM is used for sending payments on the Fantom network.
- Governance - You can use FTM to vote on important decisions via the staking process, the more FTM you hold, the more voting power you get.
- Fees - Network fees are paid for using FTM, including transaction fees, smart contract fees and costs for creating new networks.
Fantom's token sale was launched in June 2018, with FTM tokens selling for $0.043 each. The current price of FTM is around $2.80.
How Does Fantom (FTM) Work?
Fantom uses an Asynchronous Byzantine Fault Tolerant (aBFT), Proof-of-Stake (PoS) protocol to secure the entire network.
Asynchronous Byzantine Fault Tolerance (aBFT) is a mechanism that enables a decentralized, trustless network.
ELi5 - Explain Like I’m Five: Asynchronous Byzantine Fault Tolerance
Asynchronous Byzantine Fault Tolerance (aBFT) is an improvement on Byzantine Fault Tolerance (BFT) which is based on the Byzantine General Problem.
Four Byzantine Generals are planning to attack a city. Each general and their army are positioned on a different side of the city.
Since each general is separated from the other, direct coordinated communication is impossible.
To plan an attack or retreat, they need to send messengers but there are issues regarding trust with this approach:
- Messengers could be captured and replaced with enemy messengers
- One or two of the generals could be traitors and could send out messengers with the intent to misinform the other generals
- Some of the messengers could turn out to be traitors and go on to spread misinformation instead
How can these generals come to a total agreement (or consensus) on whether to attack the city or retreat?
This example represents a decentralized network or blockchain, with each general representing a node in the network.
With decentralization comes freedom and with this freedom comes the ability for people to act with malicious intent.
How can you ensure that the network can come to fair consensus when nodes have the ability to act maliciously? This is where Byzantine Fault Tolerance comes in.
Byzantine Fault Tolerance is a solution that ensures that a network is going to act fairly, even if there are bad actors. Nodes in a network are guaranteed to agree on the timing and order of transactions.
Byzantine Fault Tolerance enables a network to come to an honest consensus, even if up to 1/3 of nodes decide to prevent that consensus, for example by delaying transactions.
Asynchronous Byzantine Fault Tolerance (aBFT) improves on Byzantine Fault Tolerance by allowing some messages to be lost or delayed infinitely.
This is done because many Byzantine Fault Tolerance systems assume that there is an upper time limit on messages.
Asynchronous Byzantine Fault Tolerance (aBFT) assumes that messages from an honest node will eventually get through, despite being lost or delayed.
In short, Asynchronous Byzantine Fault Tolerance (aBFT) enables a network to reach an honest consensus, even if 1/3 of nodes are acting maliciously.
You can read a more in-depth explanation on Asynchronous Byzantine Fault Tolerance (aBFT) in this Fantom FTM Investment Analysis.
Fantom uses aBFT for it's Proof-of-Stake (PoS) procotol known as Lachesis. It's a highly scalable protocol which ensures fast speeds and high security on the Fantom network.
Fantom uses aBFT for it's Proof-of-Stake (PoS) procotol known as Lachesis. It's a highly scalable protocol which ensures fast speeds and high security on the Fantom network.
Lachesis powers "Opera", Fantom's mainnet blockchain platform.
Opera is an Ethereum Virtual Machine (EVM) compatible platform that also supports smart contracts in Solidity, Ethereums coding language.
Since Opera is EVM compatible, Fantom applications can be built to work with Ethereum based platforms.
This also makes it easier for Ethereum developers to migrate over to Fantom.
What Makes Fantom (FTM) A Good Investment?
Here are a few of the reasons why serious investors should consider investing in Fantom (FTM).
Fantom's Defi Ecosystem Is Rapidly Growing
Defi on Fantom has been growing rapidly due to Fantoms speed and low fees.
To give you an idea of how fast the defi ecosystem has grown on Fantom, you can look at its Total Value Locked (TVL).
TVL measures the total value of the tokens locked within dapps on a network or platform.
Essentially TVL shows you how much money in total has been locked up within dapps on a network via processes such as staking, liquidity pools, farms etc.
Total Value Locked on Fantom has grown from $373,203 in April 2021 to over $7 Billion in January 2022.
That is over 18,756x growth in less than a year.
Ethereum based Automated Market Maker (AMM) & DEX SushiSwap has also launched on Fantom so traders can take advantage of the low fees and instant settlements.
Fantom are building a centralized exchange using Binance Cloud
At the Fantom Developers Conference 2021, Harry Yeh announced that Fantom was building a Binance Cloud powered exchange for Fantom tokens.
This centralized exchange will make it easier for users to trade Fantom based tokens, with a familiar UI and deeper liquidity.
Fantom's exchange will include FTM pairs for every token and will support the use of high-frequency trading bots for a better trading experience.
Upon launch, the Fantom exchange will support the following cryptocurrencies:
- SpookySwap (BOO)
- Spirit Swap
- Tomb, Tshare, Tbond
- Ice
- Spell
- MIM
- Yoshi
- 1Art
Fantom is one of the very few projects that are building a centralized exchange and I expect the demand for FTM to increase due to FTM pairs on the platform.
Fantom has a Strong Community
A large and active community is key to the growth and adoption of any blockchain platform.
Fantom currently has $1.6 Million unique addresses on the network, growing by over 13,300 new addresses daily.
On average there are over 750,000 daily transactions on Fantom, with transactions in January reaching over 1 Million.
Fantom is backed by Renowned Investors
Fantom has received large investments including a $35 Million investment from renowned trading and investment firm Alameda Research.
Other leading blockchain and crypto investment firms that have invested in Fantom include:
- HyperChain Capital with a $15 Million investment
- BlockTower Capital with a £20 Million investment
How to Invest in Fantom (FTM)
You can buy Fantom (FTM) from a cash-based exchange platform like Kucoin (Worldwide and USA users) or Bitpanda (Europe only).
You can store your FTM on the exchange or download the free official Fantom wallet and send your tokens there.
I hope you enjoyed this story; feel free to check out the useful resources below
Kucoin - Great exchange where users can trade over 750 different cryptocurrencies, including new, low market cap cryptocurrencies. Available worldwide, including the USA.
BitPanda — If you live in Europe, one of the best exchanges to buy cryptocurrencies with cash, including Bitcoin (BTC), Ethereum (ETH), Fantom (FTM), Polygon (MATIC), Solana (SOL) and many more. Only available in Europe
You can also keep up with me on Twitter and if you need a content writer for your website, publication, project or campaign, contact me on cryptonitewrites@gmail.com.
You can also keep up with me on Twitter and if you need a content writer for your website, publication, project or campaign, contact me on cryptonitewrites@gmail.com.