Fantom is a prominent Layer 1 blockchain in the crypto market, once gaining attention as its FTM token surged over 100x in the previous bull market. In 2024, the project continues to evolve with its latest tech upgrade called Sonic, which promises superior transaction speed and reduced costs. In this article, Coin60s will guide you through Fantom’s core technology, ecosystem, tokenomics, and its long-term investment potential.
What is the Fantom?
Fantom is a decentralized, open-source Layer 1 blockchain platform designed to deliver high-speed, low-cost, and highly scalable infrastructure for decentralized applications (dApps). Unlike many traditional blockchains that follow a sequential block-chain model, Fantom adopts a Directed Acyclic Graph (DAG) structure combined with an aBFT consensus algorithm called Lachesis to process transactions asynchronously.
What sets Fantom apart is its ability to confirm transactions in just 1–2 seconds while maintaining robust security, even when part of the network fails or faces attacks. This makes Fantom well-suited for performance-intensive use cases in DeFi, AI, and various blockchain-powered sectors.
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Why was Fantom created?
Fantom was created to solve some of the most pressing problems faced by earlier generation blockchains, particularly Ethereum. These problems include slow transaction confirmation times, high gas fees, limited scalability, and congestion during periods of high demand. As the popularity of decentralized finance (DeFi) and Web3 applications grew, so did the need for a more scalable and efficient blockchain infrastructure.
The core vision behind Fantom was to build a highly scalable, secure, and decentralized platform that could meet the real-world demands of both developers and users. Instead of simply improving upon Ethereum’s model, Fantom took a fundamentally different architectural approach by adopting a DAG (Directed Acyclic Graph) structure combined with an asynchronous Byzantine Fault Tolerant (aBFT) consensus mechanism called Lachesis. This innovation enables parallel transaction processing, drastically improves speed, and reduces costs while maintaining security and decentralization.
Furthermore, Fantom was designed to support a wide range of use cases, from financial applications and supply chain management to smart city solutions and public infrastructure systems. By providing a flexible and robust base layer, Fantom empowers developers to deploy decentralized applications with performance and scalability previously unattainable on traditional blockchains.
In essence, Fantom was born out of the need for a new generation of Layer-1 blockchain that could bridge the gap between decentralization, speed, and real-world utility—laying the groundwork for mass adoption of blockchain technology.
Key Highlights of Fantom
Fantom stands out thanks to its advanced technical features and unique innovations:
- Lachesis Algorithm: Fantom’s proprietary aBFT (Asynchronous Byzantine Fault Tolerance) consensus mechanism enables ultra-fast transaction validation without sequential confirmation. It ensures low latency, rapid finality, and security even if one-third of nodes are faulty or compromised.
- DAG Architecture: By using a Directed Acyclic Graph structure, Fantom enables parallel transaction processing, boosting throughput and scalability without compromising security.
- Fantom Sonic (2024): The latest upgrade pushes the network to 2,000+ TPS, reduces storage costs by up to 90%, and introduces Fantom Virtual Machine (FVM) along with Carmen database for optimized performance.
- EVM Compatibility: Fantom can run any Ethereum-based smart contract without code modification, facilitating smooth migration and deployment of existing dApps.
- Low Cost & High Speed: With its architecture, Fantom delivers thousands of fast transactions at a fraction of the cost compared to Ethereum.
- Active Development Community: Fantom Foundation actively funds the ecosystem, delivers upgrades, and expands multi-chain interoperability.
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Fantom Ecosystem and Key Products
Fantom’s ecosystem is thriving and expanding across multiple verticals, including DeFi, NFTs, AI, and decentralized social networks. Some of its standout components and initiatives include:
- Fantom Sonic: A major network upgrade delivering 2,000+ TPS, 90% lower storage costs, and full EVM compatibility for seamless dApp integration.
- Fantom Virtual Machine (FVM): A next-gen virtual machine optimized for smart contract performance, with an upcoming Parallel FVM enabling concurrent transaction execution.
- Carmen Database: A newly introduced data storage system designed to enhance efficiency and reduce operational costs network-wide.
- Cross-chain Bridge: A secure cross-chain communication protocol under development to enable interaction between EVM-compatible blockchains.
- Ecosystem Grant Program: A funding initiative from Fantom Foundation targeting diverse projects in DeFi, social, AI, and more, fostering sustainable ecosystem growth.
- Planned Native Stablecoin: A Fantom-backed stablecoin is expected to support liquidity and boost on-chain economic activity.
What is the FTM Token?
FTM is the native utility token of the Fantom network, playing a vital role in maintaining and powering its ecosystem. It is deployed across multiple blockchains like Ethereum, BNB Chain, Solana, and Celo, offering flexibility in cross-chain applications and DeFi integrations.
Key utilities of the FTM token:
- Network fees: FTM is used to pay transaction fees, deploy smart contracts, and create new applications on Fantom.
- Staking: Token holders can stake FTM to earn rewards while contributing to network security.
- Governance: FTM holders have voting rights on proposals that influence the future development and protocol upgrades.
Technical specifications:
- Name: Fantom
- Ticker: FTM
- Platforms: Ethereum, BNB Chain, Solana, Celo
- Standard: ERC-20
- Total Supply: 3,175,000,000 FTM
- Circulating Supply: 2,803,634,835 FTM
FTM Token Allocation:
- Block Rewards: 32.75%
- Private Sale (2 allocations): 25.35% and 11.69%
- Advisors/Contributors: 12.00%
- Strategic Reserve: 6.00%
- Seed Sale: 3.15%
- Public Sale: 1.57%
Development Team, Investors, and Partners
Fantom is led by an experienced team with strong technical expertise in blockchain. Michael Kong serves as the CEO and CIO, overseeing strategic and technical development. Andre Cronje, a prominent figure in the DeFi space, is one of the project’s co-founders and continues to contribute significantly as a director and core contributor. Although he once announced stepping away from DeFi, Cronje has remained closely involved with the Fantom Foundation and plays a pivotal role in its evolution.
On the investment side, Fantom has secured support from several top-tier blockchain investment firms, including HyperChain Capital, Signum Capital, 8Decimal, Arrington XRP Capital, Bibox Fund, Link VC, Nirvana Capital, and JRR Crypto. These investors have backed the project since its early stages and continue to play a critical role in expanding the ecosystem and supporting Fantom’s long-term growth.
Roadmap
While Fantom has not released a detailed roadmap with specific timelines, recent updates indicate a clear strategic direction focused on infrastructure upgrades and ecosystem expansion. The main highlight is the upcoming Fantom Sonic upgrade, which aims to address scalability, performance, and cost-efficiency challenges.
Fantom Sonic consists of two core components: the Fantom Virtual Machine (FVM) and the Carmen database system. This architecture is designed to process over 2,000 transactions per second while reducing storage costs by 90%. Additionally, the team plans to launch cross-chain bridges, streamline staking and liquid staking processes, expand grant programs across DeFi, decentralized social media, and AI, and implement zk-SNARKs for enhanced security. There are also plans to issue a native stablecoin to boost liquidity and utility within the Fantom ecosystem.
These initiatives signal a strong commitment to making Fantom one of the most efficient and developer-friendly Layer 1 blockchains in the near future.
Strengths and Limitations of the Project
Strengths:
Fantom offers multiple compelling advantages that make it attractive to both investors and developers. Its combination of aBFT consensus and DAG (Directed Acyclic Graph) enables extremely fast transaction speeds (1–2 seconds), low fees, and robust security and scalability. The upcoming Fantom Sonic upgrade demonstrates the team’s forward-looking vision by improving performance while maintaining compatibility with EVM-based blockchains. Fantom’s expanding ecosystem includes a growing number of DeFi, NFT, and cross-sector applications.
The project is also backed by a strong community and notable figures such as Andre Cronje, a respected name in DeFi. Institutional support from venture capital firms like HyperChain Capital and Signum Capital further strengthens investor confidence.
Limitations:
Despite its strengths, Fantom faces several challenges. A key issue is the lack of a transparent, detailed long-term roadmap, which may make it harder to attract new investors. Moreover, competition in the Layer 1 space is intense, with Ethereum, Solana, Avalanche, and others actively innovating to dominate the market.
Another limitation is Fantom’s relatively modest user base and limited mainstream awareness. Continued growth in developer activity and user adoption will be crucial for Fantom to maintain relevance in the evolving crypto landscape.
Should you invest in Fantom (FTM)?
Fantom (FTM) presents a compelling investment opportunity for those seeking a high-performance Layer 1 blockchain with long-term potential. The platform’s innovative use of aBFT and DAG technologies enables ultra-fast transaction speeds, low fees, and robust scalability. Recent developments such as the Fantom Sonic upgrade, plans for Parallel FVM, and a native stablecoin indicate that the team is actively working to grow and strengthen the ecosystem.
However, like any crypto investment, FTM comes with its risks. The ecosystem is still maturing, the user base is not yet on par with leading blockchains, and Fantom faces stiff competition from players like Solana, Avalanche, and Ethereum. Moreover, FTM saw significant price growth during the previous bull cycle, so current valuations should be carefully assessed.
If you’re a medium- to long-term investor with a moderate risk appetite and believe in Fantom’s technological vision, FTM could be a promising addition to your portfolio.
Conclusion
Fantom is one of the few Layer 1 blockchains that successfully combines speed, low fees, and high security through its DAG architecture and unique aBFT consensus mechanism. With recent upgrades like Sonic, Fantom has significantly enhanced its performance and positioned itself for broader adoption in the future. However, to truly stand out, the project must continue expanding its ecosystem, growing its user base, and competing effectively with leading platforms. Despite ongoing challenges, Fantom remains a noteworthy project to watch and evaluate in the next phase of the crypto market.