What Is Blockchain Ecosystem?
Before moving to the Fantom ecosystem, let’s first understand what the crypto ecosystem means in general. On top of that, we recommend you also read our big article, titled “What is Fantom(FTM)?”.
So, it’s essential to remember that blockchain applications’ success does not happen overnight. In reality, you need a large number of visionaries with exciting and original ideas, as well as technical professionals with the necessary expertise to bring the ideas to life. The efficiency of blockchain is based on its use for the automation of cross-enterprise activities, which is where you would meet the definition of the blockchain ecosystem.
The basic definition of a blockchain ecosystem is a group of things that can interact with each other and the world around them to make an environment with special features that people want.
A blockchain ecosystem can also be thought of as a set of rules that everyone agrees on for a certain use case. The governance structure spells out what participants can and can’t do, who owns the data, how it will be paid for, how people can leave and join, and how they can share information with each other.
With a distributed ledger, you could find real benefits like decentralization, independence, more flexibility, an audit trail, better transparency, and a lot more. But, like any other new technology in business operations today, blockchain is also subject to other worries.
In this case, some of the most important things to worry about are choosing the right information for the network and knowing who wrote the information on the shared chain. All of these problems are part of the ideas for new blockchain ecosystems, and planning how to handle them will make sure the project is successful.
What Is The Fantom Ecosystem?
As you understand, the ecosystem is a set of interconnected functional and financial bodies which ensures the stable and safe operation of the blockchain.
Every ecosystem has a key issue that it is trying to solve
Fantom solves a key issue called the “Blockchain Trilemma.” The blockchain trilemma refers to the fact that speed, security, and decentralization can’t all be met at the same time.
To implement those noteworthy features, Fantom adopts the use of Lachesis – an innovative aBFT (Asynchronous Byzantine Fault-Tolerant) consensus mechanism. A consensus is a dynamic way for a group of people to come to an agreement. The “consensus mechanism” is a way to make decisions that everyone agrees on.
The main things about the Lachesis algorithm are:
- Asynchronous: Users can run commands at any time they want.
- Leaderless: No one is taking control of the system all by themselves.
- Byzantine Fault-Tolerant: Functional even with 1/3 nodes being faulty or malicious.
- Final: Transactions are finalized within 1–2 seconds, which can be thought of as instantly.
Fantom Ecosystem Overview
If we try to put it simply, then the following structure is obtained:
- There is a Fantom network, which is called Opera mainnet,
- The network is governed by a consensus mechanism called Lachesis.
- On top of that, many other Fantom Foundation projects are operating within the framework of the Opera mainnet.
- Also, there are various cross-bridge interactions with other blockchain systems via different tokens, respectively.
We have a very interesting article titled FTM Exchange Via Blockchain Bridges. Take the time to read it.
What Is Fantom Ecosystem Spotlight?
On September 6, 2021, Fantom added a new section to its blog called Fantom Ecosystem Spotlight. This is a category/library that allows different Fantom projects to interact directly with the Fantom Foundation, bringing the Fantom Foundation, the project, and its community closer together.
It will help us better understand the projects from the Fantom ecosystem that we are interested in.
Now let’s take a look at some of the most popular ones.
SpookySwap is an automated market-making (AMM) decentralized exchange (DEX) on the Fantom Opera network. In order not to get bogged down in terminology, let’s understand what automated market-making means.
An automated market maker (AMM) is a system that automatically facilitates buy and sell orders on a decentralized exchange. Simply put, automated market makers are autonomous trading mechanisms that eliminate the need for centralized exchanges and related market-making techniques.
And what means “swap”?
Swap makes it possible for two non-native tokens from two different blockchains to be exchanged instantly, without the need to start the traditional crypto-to-fiat exchange or token migration.
Thus, SpookySwap is a cryptocurrency exchange, but contrary to traditional exchanges, there isn’t someone else on the other end of your trade.
Trades are fulfilled automatically using liquidity provided by other users, and the price you receive on the trade is relative to the ratio of the two tokens you’re trading.
Using SpookySwap requires no sign-up, no user information, and no data collection whatsoever. Interacting with SpookySwap is trustless, and anyone can make trades or provide liquidity.
The reward for providing liquidity is both collecting a portion of the swap fee and collecting the newly circulating BOO, the SpookySwap governance token.
VERDICT: So, we learned that there is an independent exchange project inside the Fantom ecosystem called SpookySwap, which has its own token called BOO. The latter is one of the coins of the Fantom ecosystem.
SpiritSwap is another decentralized exchange (DEX) on the Fantom Opera Network. It is one of the first decentralized exchanges (DEXs) built on the Fantom Opera Chain and based on an automated market maker. It lets people trade without brokers and centralized control. Using an AMM, Liquidity Pools automatically figures out the price of two tokens that have been deposited.
But what is Liquidity?
A liquidity pool is a user-generated pool of cryptocurrencies or tokens that are locked in a smart contract and used to help trades between assets on a decentralized exchange (DEX).
The SpiritSwap users, as usual, will be charged a small fee of 0.3% each time a swap is done safely. And the fees are given to Liquidity Providers and people who own inSPIRIT tokens to encourage the exchange platform to grow.
On SpiritSwap, there are three types of tokens that users should be aware of as follows:
- SPIRIT: The utility protocol token running on the Fantom Opera Chain. Alternatively, SPIRIT tokens can be locked to obtain inSPIRIT.
- inSPIRIT: The non-transferable governance token benefits users with additional tokens when holding it.
- SPIRIT-LP: Represents the proportional share of users in pools.
VERDICT: This time we got acquainted with a decentralized exchange project operating in the Fantom ecosystem, which has its own features and tokens. Just like BOO, SPIRIT coin(s) belong to Fantom Ecosystem too.
Tomb Finance is the first algorithmic token pegged to $FTM on the Fantom Opera network.
What is an algorithmic token?
As the name suggests, this kind of stablecoin uses an algorithm to keep its value stable. Most of the time, these algorithms link two coins and then change their prices based on how many investors want them and how many investors don’t. Although an algorithmic stablecoin is tied to the value of a real-world asset, it is not backed by one.
Tomb Finance has chosen to align its mission to provide value to and derive value from the Fantom network’s future growth.
As the network grows and more FTM is locked into validator nodes, TOMB token will serve this purpose by providing users with an exchangeable, mirrored, liquid asset to FTM.
VERDICT: In addition to existing and future use cases, $TOMB’s primary aim is to become the main medium of exchange on Fantom Opera.
NFTKEY ‒ pronounced N-F-TIKI ‒ is a secondary marketplace for people to collect and trade NFTs. And, of course, it is based on the Fantom Opera network.
By connecting your wallet, finding an NFT that you are interested in, and purchasing it, you become the sole owner of exclusive digital art and a member of a wider community of people interested in the same collection as you.
VERDICT: NFTKEY is a platform that allows you to explore and trade NFTS across a wide range of collections created by different artists and teams on different blockchains. It is by far the most popular NFT project in the Fantom ecosystem.
Now you know that Fantom is a vast planet with a varied and rich ecosystem. And inside that ecosystem, you’ll find all kinds of products and assets related to the modern crypto industry. We have given you only a small sample of the hundreds of possible names. Later, we will explore more tokens in the Fantom ecosystem, including GEIST, TETU, and FHM.
If you are seriously interested in the Fantom ecosystem, take your time and try to explore the Fantom projects on your own. You may eventually decide to invest or simply use one of them.