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What Is Fantom? An efficient Smart Contract Platform In 2022

What Is Fantom?

The Smart-contract platform Fantom is a high-performance platform with scalability, customizability, and security.

The platform is being developed as a next-generation blockchain platform, with the goal of addressing various shortcomings of current blockchain systems. It is permissionless, decentralized, and open-source since Fantom is built on top of it.

Fantom is far quicker and less expensive than prior technologies, while yet maintaining high levels of security thanks to Lachesis, a new aBFT consensus mechanism.


Fantom may be customized to your liking. Lachesis allows for the connection of several blockchains, all of which may interact with one another.

Each blockchain operates independently of the others, and each may have its own set of bespoke tokens, tokenomics, and governance rules that are unique to it.
Fantom is a modular system.

Lachesis is completely compatible with the Ethereum Virtual Machine (EVM) and may be used in conjunction with the Cosmos SDK (Software Development Kit).

What Is Fantom? An efficient Smart Contract Platform In 2022
Source: Fantom Foundation

What is Lachesis aBFT?

Lachesis is an aBFT consensus algorithm created by Fantom that achieves breakthrough performance.
The following are the most important characteristics of the Lachesis algorithm:

It is possible for participants to process commands at separate times if the session is asynchronous.

  • Leaderless: There is no “special” role played by any of the participants.
  • Fault-Tolerant Byzantine Architecture: This architecture is functional even in the presence of up to one-third of defective nodes and malicious nodes.
  • Final point: The product of Lachesis may be employed right away. Transactions are verified within 1-2 seconds after being submitted..

The platform is flexible and interoperable with various development tools, such as the EVM or the Cosmos SDK, and may be extended in the future. It can be quickly and simply implemented into any blockchain system.


Lachesis provides for the scaling of transaction throughput while maintaining immediate finality and without the possibility of centralization being enhanced.

How does Lachesis function?

In each Lachesis node, an Acyclic Directed Graph (DAG) is stored, which is built of event blocks, each of which contains a sequence of transactions.

Using a DAG, which captures the happens-before connection between events, it is possible to determine an accurate final order of events (and hence transactions) that is independent of the node on which they occur.

Event blocks are divided into two categories: verified event blocks and unconfirmed event blocks. Nodes with honest intentions do not order event blocks that have just been confirmed; instead, nodes with honest intentions order event blocks that have been confirmed for at least 2-3 frames.

As a consequence of consensus, batches of verified event blocks are formed, with each batch of events being known as a block. Finalized blocks composing the final chain are computed separately from the local DAG of event blocks stored on each node, resulting in the final chain being formed.

Round-robin voting is different from Proof-of-Work voting. Proof-of-Stake (PoS) and coinage Lachesis nodes do not communicate blocks to each other since they are Proof-of-Stake and sync BFT.

Syncing just the events across nodes is possible at this time. Validators do not vote on a specific state of the network; instead, they communicate with their peers on a regular basis about transactions and events they have witnessed.

In contrast to classical consensus methods such as pBFT, Lachesis does not employ new events in the present election; rather, new events are used to vote for the events in 2-3+ prior virtual elections at the same time, as opposed to classical consensus methods.

A lesser number of constructed consensus messages is produced as a result of this, since the same event is repeated in several elections.

By using Lachesis instead of synchronous BFT, a shorter time to finality is achieved, as well as a reduced communication overhead.

What are epochs in Lachesis?

The event structure of Lachesis is represented as a DAG of events. The DAG is divided into sub-DAGs, each of which is referred to as an epoch, in order to maximize storage and retrieval. Each era is made up of a large number of completed blocks.

Each era is marked by the fulfillment of one of the following conditions:

  1. When the epoch reaches a certain number of blocks, the epoch is considered complete.
  2. The epoch is defined as a period of time that begins and ends at a certain moment.
  3. In this block, at least one cheater has been discovered.

When an epoch is sealed, the indexes of its inner epochs are trimmed, and any new events that occur during the sealed epochs are disregarded. The DAG of each period is distinct from the others, and hence parents from other epochs are not permitted.

Each event contains the hash of the preceding epoch, which serves as a sanity check.

Proof Of Stake

Staking is the technique of safeguarding a network by encrypting your tokens and locking them away. When used in a Proof-of-Work network such as Bitcoin, it does the same task as mining.


Nodes that verify transactions are called validator nodes, and the staked tokens serve as an economic incentive for stakers to adhere to the protocol’s regulations.


To avoid sybil attacks on the network, Fantom uses Proof-of-Stake to ensure that validators remain anonymous in order to keep the network decentralized and robust against assaults from the outside. A sybil attack is a kind of network attack in which a hostile actor operates a huge number of validators in order to gain an unreasonably high degree of control over the network.

As a result of Proof-of-Stake, it is more expensive to set up validators, and the network may penalize validators that engage in malicious activity, raising the overall cost of assaults.


To combat sybil attacks, Fantom needs validator nodes to lock-up a minimum of 500,000 FTM (Fantom’s native coin) on their computers.

Staking On Fantom

For the purpose of validating transactions and securing the network, Fantom employs a Proof-of-Stake consensus method. You may participate by putting your FTM on the line.

In return, you will get FTM tokens as a reward. You do not need any specialized technology or software to bet your money.

You may complete the process immediately from your phone or computer. Despite the fact that staking implies that your tokens are locked up, they are still in your wallet and only you have access to them. You have the ability to unlock your FTM at any moment.

Staking parameters

  • Minimum amount: 1 FTM
  • Minimum lock-up period: 0 days, earning the base reward rate
  • Maximum lock-up period: 365 days, earning the maximum reward rate
  • Unbonding time (time between unstaking and funds becoming avilable): 7 days
  • Delegation fee: The network has set a fixed fee of 15% on staking rewards paid from stakers to validators for running their nodes.

Guide

  1. Click on “Staking” in the menu bar
  2. Click “Delegation”
  3. Choose the amount of FTM you would like to stake and a validator. You can click on a validator to show more information. Make sure to do your due diligence regarding the validators. A validator cannot access your funds; however, if a validator acts maliciously, your staked tokens could be reduced.
  4. Select your lock-up period

You can calculate your Rewards using Fantom’s Calculator.

What Is Fantom? An efficient Smart Contract Platform In 2022
Source: Fantom Foundation

Transaction Fees On Fantom

In order to avoid spam attacks on Fantom, each transaction on the network is subject to a transaction fee that must be paid to the network. The charge is denominated in FTM (Fantom’s native cryptocurrency).


Transaction fees are provided to validators as a kind of compensation for their efforts in processing transactions.

An SFC contract has complete control over the allocation of rewards. The governance of the SFC contract has the ability to update the contract at any point without triggering a hardfork.


The SFC contract holds onto 30% of transaction fees (the monies in this account are not used to pay for transactions). The remaining 70% of transaction fees are divided among validators in accordance to their contribution to the transaction reward weight.

Finality

A transaction’s finality refers to the fact that it cannot be modified or reversed by any participant. Because they attain total finality, aBFT consensus algorithms such as Lachesis have a very short time to finality compared to other algorithms. A transaction’s absolute finality implies that it is deemed complete once it is included in a block of transactions.

With Fantom, Opera Chain may complete the finality process in 1 to 2 seconds.
TxFlow is capable of achieving finality in less than a single second.

Nakamoto consensus procedures, on the other hand, depend on probabilistic finality to achieve consensus. Consequently, the likelihood that a transaction will not be reversed grows with time in this situation.

To reverse a transaction in a block, it would be more difficult and expensive to do so if a number more blocks were generated on top of it, each of which confirmed the transaction to be accurate. Eventually, it becomes theoretically impossible to change previous blocks, raising the probability of finality to almost 100 percent.

Because Bitcoin transactions have a finality of 30 to 60 minutes, you must wait for a few block confirmations before considering the transaction to be complete and irreversible while utilizing the cryptocurrency. Ethereum has a finality of a few minutes at the very least.

What can I do with my Fantom?

Within the Fantom ecosystem, the FTM token may be used in a variety of applications.

Keeping the network safe


Fantom operates on a Proof-of-Stake mechanism, which necessitates the possession of FTM by validators.


A validator node may be operated by anybody who has at least 500,000 FTM and wants to collect epoch rewards and transaction fees in the process.


Everyone who has FTM tokens has the opportunity to delegate their tokens to a validator (while maintaining complete control over their finances) in order to obtain staking incentives.
Validators are then paid a nominal fee for their efforts.


Validators contribute to the decentralization and security of the network by locking in their FTM.

Pay for network use costs (Fees)


Every operation done inside the Fantom network is subject to a minor charge in order to reward validators for their services and to prevent transaction spam from occurring.
This charge is paid in foreign currency (FTM).

Participate in on-chain governance via voting


On-chain voting is used to make decisions about the Fantom ecosystem, which is transparent and decentralized.


Votes are weighted based on the quantity of FTM that an organization has in its possession.
In essence, one FTM equals one vote.


Validators and delegators may vote on network characteristics like as block rewards, as well as technical committees and other such matters when FTM is used as the governance token.

Additional application scenarios


Fantom Finance, part of the Fantom DeFi package, accepts FTM as a form of collateral.

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