What is Fantom Blockchain? How it Works?
In the past few years, hundreds of blockchain networks have emerged to outperform Bitcoin and Ethereum. One such network is Fantom, aspiring to offer a host of features and improvements when pitted against legacy blockchain networks.
Such aspirations raise questions such as what Fantom blockchain actually is? What makes Fantom work? Where can one buy Fantom crypto? Let’s tackle these questions one after another. But first, what is it?
What Is Fantom Blockchain?
Fantom is a permissionless, decentralized, open-source smart contract platform for digital assets and decentralized applications (dApps). Fantom was founded in 2019 and since day one, the project aims to provide a feasible solution to the blockchain trilemma by banking security, scalability, and decentralization in a single network.
Connecting your Fantom Address to ZenLedger For Your Crypto Tax Forms
- To import your Fantom transactions into ZenLedger for your crypto tax forms, all we need is your public address.
- Select the proper blockchain or wallet from the dropdown list.
- Paste your address into the address field in ZenLedger.
- Select if the wallet is based in the USA or not.
- Then hit the ADD COIN button
How Fantom Works?
Fantom functions on top of a custom “leaderless” proof-of-stake (PoS) consensus mechanism also known as Lachesis. It is an asynchronous Byzantine Fault Tolerant (aBFT) consensus mechanism that not only provides faster transactional speeds but also ensures the security of those transactions. The aBFT tolerates almost one-third of malicious behavior from participants of the network without causing any harm to the network activities.
Features of Lachesis
- Near-instant finality means it only takes a few seconds to finalize a transaction and it doesn’t need the arduous block confirmation of proof-of-work (PoW) networks.
- Faster transactions and scalable network due to the aBFT system.
- Every network node has its own Directed Acyclic Graph (DAG) recording the chronology of each transaction and event block. Further, the event blocks are compiled into finalized blocks that are added to the Fantom blockchain.
- A Leaderless PoS mechanism means no one has a special role in the operation. There are no block leaders and no participants and anyone can join or leave the node network at any point.
Fantom Staking, FTM Token, and DeFi Suite
FTM, Fantom’s native currency, governs the entire Fantom blockchain. Fantom crypto is used for:
- Fees on the network
Fantom crypto is available as an ERC-20 token on the Ethereum network and as a BEP-2 token on the Binance network. If an FTM holder has a single FTM, they are eligible for staking the token on a Fantom wallet address. When a holder stakes the coin, it is automatically exchanged from ERC-20 FTM tokens or BEP-2 tokens to Opera FTM tokens. The only criteria to run a validator node on Fantom’s network is that at least 3,125,000 FTM has to be staked.
Staking on the Fantom network can be quite lucrative as the users can earn up to 4 percent annual percentage yield. Moreover, Fantom users can also benefit from Fantom’s Fluid Reward by locking FTM up for a pre-agreed time, which is usually from two weeks up to a year providing rewards as much as 12 percent APY.
Fantom blockchain also has a feature known as liquid staking, where a staker can mint FTM equally as their staked FTM. For instance, if a staker stakes 1 FTM, they will receive 1 FTM as a reward to be used as collateral in Fantom Finance, a DeFi application suite offered by Fantom. This feature enables Fantom users to get something a little extra out of their staked tokens. Fantom’s DeFi offerings include:
- fUSD: a stablecoin based on Fantom, whose value is linked with the USD
- fSwap: a decentralized synthetic asset trading platform
- fLend: a liquidity pool where users can lend FTM and fUSD to earn interest
How to Buy Fantom Crypto?
If you are a beginner, buying Fantom can be a daunting task. However, with our step-by-step process, it gets quite simple. Here’s what you need to do:
Step 1: Open an Online Account
You can buy FTM from exchanges such as Bitget, Binance, Hotcoin Global, and more. It is always recorded to research several crypt exchanges as they have different features and trading fees.
To create an account with these exchanges you have to provide your full legal name, email address, age, and government-issued ID. And, after finishing your KYC, you are good to go. But before that, you might need a crypto wallet.
Step 2: Buy a Wallet (optional)
You can leave your coins on the exchange but using hardware or a software wallet offers better security. If your exchange gets hacked, your coins will be safely stored in your wallet. Choose a wallet as per your needs and budget.
Step 3: Make your Purchase
After setting up your online account and buying your wallet, all you need to do is fund your trading platform account with sufficient funds and you can buy FTM.
The Fantom blockchain is a promising dApps and DeFi ecosystem. The performance of the network is strong and it offers interesting features such as faster transactions, a scalable network, Fantom Liquid Staking, and more. Also, the network has the capability of running large-scale network interactions.