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Fantom (FTM) Overview mixed with a general Crypto/Blockchain Overview

I want to start off by saying that I am in no way an expert on any of this, but I have been in Crypto since early 2017 and have tried to learn as much as possible about the space and all the different projects over the past 4 years (I must say, it’s much easier and less stressful to fully grasp what’s going on during a bear market). I’m aware there are a lot of new people coming into this space, so as I’m typing this, I kind of want to do a mix of a review on Fantom with a review of Crypto/Blockchain in general. I’ve been reading through a lot of posts on this sub and there is a lot of confusion and many people who have no idea what’s going on. That’s not to say I completely understand everything, but I remember that feeling in 2017 and it has been much less stressful and overwhelming this time around as I’ve learned more about the bigger picture and what in the hell is actually happening. I’ll try to simplify everything to make this as short as possible, but I can already tell this is going to be a long post.

Full disclosure – I only learned about Fantom as it started to pump a couple weeks back and bought in during the rise and have DCA’d throughout the correction. Not trying to shill this project as I really don’t look at this whole thing as one big competition where someone will come out on top. I’m just excited about everything I’ve learned about Fantom so I want to share with anyone that may be confused as I’ve seen tons of mentions of FTM in the daily, but nobody really breaking down what it is or why it pumped so hard. For anyone that notices me saying something blatantly wrong or wants to elaborate on something I say, PLEASE feel free to rip this post apart as I don’t want to misinform people and I am still trying to learn as much as possible.

To start off, Fantom is a smart contract platform that uses a DAG (Direct Acyclic Graph). I won’t take a deep dive into DAG technology so I’ll just share [this article](https://www.coinbureau.com/education/directed-acyclic-graphs-dags/) for you guys to get a brief understanding if you’re unfamiliar. Other Cryptos (IOTA, Nano) use DAG as well so I’m sure most people have at least heard of it.

**Blockchain Revolution**

This entire revolution with crypto and blockchain is to foster in the era of Web3. For those that have not heard of the term Web3, I won’t go into but I will provide [another article](https://blockchainhub.net/web3-decentralized-web/) that will hopefully clear some things up. The purpose of blockchain is to help achieve the goals of Web3 by creating an ecosystem built on decentralization, transparency, and consensus. Bitcoin wasn’t groundbreaking because it implemented blockchain, but rather because of its consensus algorithm (Proof of Work). The PoW concept was actually introduced before Bitcoin, but Bitcoin implemented and popularized it. To break it down simply, it allowed the network to reach consensus by having a bunch of computers (these are the miners you always hear about) solve complicated math problems to confirm and verify transactions that occurred on the network in a decentralized manner.

Vitalik took this to the next step with Ethereum where he used PoW to build a platform that was programmable. Developers could now build all kinds of decentralized applications (dApps) on Ethereum which kickstarted this movement and brought us thousands of Cryptocurrencies.

The issue with PoW, however, is that as more people began using the network, fees increased and transaction times slowed down. That’s why all these different consensus algorithms started appearing like Proof of Stake (PoS), Liquid Proof of Stake (LPos), Delegated Proof of Stake (DPos), etc. The entire 2017 bull run was built on a bunch of ICOs and everyone trying to find the next “Ethereum killer.” Vitalik and everyone behind Ethereum obviously understood the issues regarding scalability, which is why you keep hearing about the hype regarding all these Layer 2 solutions and Eth2.0. If you don’t know what Layer 2 means, to put it simply Bitcoin and Ethereum are Layer 1 solutions – they have their own chain. The purpose of the Layer 2 solutions being built on top of Ethereum is to relieve Ethereum‘s network of congestion, which will allow it to scale.

**Fantom Overview**

I got a bit sidetracked, but back to Fantom. Fantom’s consensus algorithm is called Lachesis. This mechanism allows for faster and cheaper transactions and was co-authored by Andre Cronje (I’ll discuss him later). I can look around and find something to explain it better than I can and edit this post later, but I feel like I’ve rambled on enough and should get to talking Fantom.

Fantom is a separate Layer 1 solution. There are plenty of other Layer 1 solutions that are smart contract platforms out there as well (Polkadot, Cosmos, Tezos etc.) The reason why Polkadot and Cosmos became so big so quick was because their entire thing is Interoperability – allowing all these different blockchains to communicate with each other. The reality is that Ethereum isn’t going anywhere, but that doesn’t mean that other Layer 1 solutions won’t pop up, be adopted, and have developers building on top of them and users using them. But what’s the point of this revolution if Alice becomes an Eth fangirl while Bob is constantly shilling Tezos and both only want to use the dApps built on their chain. There’s no way for them to communicate or send each other Crypto or interact via the blockchain. That’s where you started seeing all this wrapped BTC (wBTC) and wrapped Ethereum (wETH) coming in. I’m not going to dive into that either, but essentially it was all one big mess (and still is really) with a bunch of different chains that wanted to be ‘the one’ but realized 1) there most likely won’t be just one and 2) if there is, then it’ll be Ethereum. But the point is that interoperability is necessary for this to become what we envision it as. There won’t be just ‘one chain’ and there won’t be thousands of chains, but the ones that are around will have to interact with one another without the end users having to go through a billion steps to make that happen. That can be a whole post of its own.

Fantom, while being a separate Layer 1 solution, can be viewed as a pseudo-Layer 2 solution. The Fantom Opera Network (I also love the name) is compatible with the Ethereum Virtual Machine (EVM) so any developer who has already built a dApp on Ethereum can simply port it over to Fantom and not have to learn a different chain’s native language to build it all over from scratch. A lot of protocols like Cream finance, Curve, SushiSwap etc. have already deployed their contracts to the Fantom Opera network so people who want to use these protocols don’t have to pay the current gas fees on Eth. It’s not an Eth killer, but more an Eth helper.

For those of you that are interested, you should set up the Fantom wallet and just play around in there. I was already sold on Fantom when I researched the project, but once I explored the wallet, I realized it was a one stop DeFi shop. Over the years, their team has mentioned that Smart Cities are a focal point for them. They had a [Medium Article](https://medium.com/fantomfoundation/fantom-foundation-update-smart-cities-a8451677b1aa) a while back that mentioned Smart Cities will be a multi trillion-dollar industry by 2025. The article discusses the pilot program in Afghanistan and I believe they have one in another city that I can’t remember off the top of my head (losing steam here…). That’s what I find so attractive about Fantom. They have provided developers with an alternative to Eth if they choose, have become a big player in this entire DeFi craze, and are trying to push the use of their blockchain on smart cities. Tomorrow, the Fantom Foundation will also be presenting to the UN Digital Currency Global Initiative’s CBDC Architecture Group. Looking forward to seeing if there is any news regarding how the presentation went, but I doubt we’ll get much tomorrow.

On top of it all, one of the biggest reasons I started paying close attention to Fantom is Andre Cronje. For those of you that don’t know him, go follow him on [Twitter](https://twitter.com/AndreCronjeTech) and read everything you can about him and by him. He has been the single most important person during the DeFi movement and has created many protocols including Yearn Finance. I can talk more about why he’s so important, but just read through his Twitter, go look at his [Medium](https://andrecronje.medium.com/), and listen to some interviews. I’ve written enough at this point and want to leave room to address the FUD that initially scared me when I first began to research this project.

**FUD**

The first thing I came across were mentions of how weak the technical papers were and how it sounded like a 5th grader trying to explain complex math. Well, I decided to listen to an interview with Andre that actually cleared some things up for me. He said when Fantom initially reached out to him to review their technical papers, he really liked what they were trying to build, but saw that they clearly had no idea how to get there. He first came on as a technical advisor, but has become much more involved as of late, mostly because he co-authored the Lachesis consensus algorithm, but I’m guessing also he saw it as a great alternative for the protocols he has built on Ethereum. He helped build out the team and from the sound of it, has helped direct them a lot over the past couple of years. Most of these projects we’re invested in have had concerns at some point during their development. They’re all open-source projects that if we didn’t have a token to buy, the developers could just quietly develop and fix bugs without having Twitter yell at them. People would still be able to keep track of the progress, but they wouldn’t have a bunch of money at stake. It’s because of all the money being thrown around that has caused everything in this space to be put under a microscope so any delay, issue with the team, or anything else makes people yell SCAM! and stay away for eternity. There have been, currently are, and will be plenty more scams, but not every issue, bug, or delay means something is a scam. Regardless, the questionable technical papers make sense after hearing that specific Andre interview.

The second thing I was worried about was that its currently too centralized. This is simultaneously a big and small concern. Most of these projects start out very centralized and Fantom is in its infancy still. There are currently only 44 nodes and it takes 3.125 million FTM tokens to become a validator. I saw this a potential issue when I bought in as the price started soaring so the price to become a validator skyrocketed as well. Less than a week later there was an issue with two nodes that was thankfully resolved within hours. Today, there was an on-chain governance proposal that put to a vote how many tokens it takes to become a validator. Right now, it seems as though it’ll drop down to 500k – 1 million. The next thing that needs to be adjusted, in my opinion, is the amount of Fantom that can be staked with a single validator. Part of the issue with the nodes a couple weeks back was that too much FTM was delegated with two specific nodes. But again, these are wrinkles that can be fixed and don’t make or break the project.

I’ll try to answer any questions I can and hope others that know more than me can help, but I just wanted to share my thoughts and give back to this sub while I was at it. I’m sure this is too long for most people to read (there are a lot of threads I nope out of real quick once I see a wall of text), but if this even helps one person, that’s all that matters. I think Fantom’s huge rise over the past couple of months isn’t indicative of a P&D or scam, but rather its huge potential and a bunch of big money coming in (two separate investment firms have invested a combined $35M into FTM over the past couple of weeks). I think Fantom is going to be a huge player in the DeFi space and anyone who was drawn to Crypto because of DeFi should definitely take a look at this project.

Useful Links

https://fantom.foundation/

https://fantom.foundation/blog/

https://pwawallet.fantom.network/#/



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