From the beginning of 2022, Bitcoin has fallen from $68,000 to $34,000, taking almost the entire crypto market with it. One exception, however, is Fantom, which has continued to increase its TVL and outperformed Binance Smart Chain and Earth.

This is what caused Fantom’s dizzying rise and the problems that could cause its downfall.

Phantom Introduction

Concept

Fantom is a fast, high performance and easily scalable layer 1 EVM Supported public chain launched in December 2019. It is the first public chain to support Lachesis, an aBFT (Byzantine Asynchronous Fault Tolerance) consensus algorithm based on DAG (Directed Acyclic Graph). Its most notable features are:

Low transaction costs. Just a transaction fee of $1 per 10 million transactions.Fast transactions. 1-2 seconds to confirm a transaction.High performance. Tens of thousands of transactions can be processed simultaneously every second.

Ecosystem

Fantom has implemented 135 protocols, covering DEX, Yield, Loans, Assets, Staking, Minting, and Derivatives. It is the fifth largest public chain in terms of protocols, behind Polygon and Avalanche.

Footprint analysis: platforms by category by chains

However, Fantom’s TVL is much larger than either Polygon or Avalanche, indicating a very promising ecosystem with plenty of room for development.

In August, Fantom announced that it would invest FTM 370 million to stimulate the chain’s development.

Financing

Fantom has closed five rounds of strategic funding and has received more than $100 million in investments from leading venture capital investors, including Alameda Research.

TVL

Fantom’s TVL has reached 18.87 billion, surpassing Terra and Binance to become the number 2 public chain. The largest contributor to TVL is bridge projects, at 34.32%, followed by yield projects, with 23.83%. In terms of specific protocols, Multichain (formerly AnySwap) is way ahead of the rest.

Footprint analysis: participation in the Fantom TVL category

The Fantom TVL build had two major periods of rapid growth.

Phase 1: Between September 21 and October 11: Up 856.5% to $10.24 billion, overtaking Tron, Avalanche, and Terra to become the fourth largest public chain, behind Ethereum, BSC, and Solana.

Reasons for rapid growth: AnySwap and Geist Finance are the main reasons that helped Fantom to explode. AnyAwap, with demand for Bridges increasing as public broadcasters struggle, contributed 43% of TVL to Fantom. Geist Finance’s participation attracted significant capital with an APY of 14,580%, securing 34% of TVL for Fantom.

Furthermore, Andre Cronje announced the migration of Yearn Finance to Fantom, which gave players confidence to enter Fantom’s DeFi project.

Phase 2: From January 1 to the present. It is up 224% to $20.83 billion, overtaking Terra and BSC to become the second largest public chain, behind Ethereum.

Reasons for rapid growth: The main reason for this phase is the help of Cronje’s influence.
On January 1, Andre Cronje (founder of Yearn.finance) announced that he would launch a new protocol on Fantom and then send his token to the top 20 TVL DeFi protocols on the chain. Major DeFi protocols have started amassing locked TVLs insanely, especially 0xDAO, which uses vampire attacks to block TVL. Eventually, Fantom TVL skyrocketed, overtaking Terra as the second public broadcaster.

Footprint Analysis – Fantom TVL

investment potential

The Fantom token was issued at $0.02, with a high price of $3.28 and an ROI of 16,300%. The current price and market capitalization are not as high as tokens on other public chains, for example Terra (LUNA) and Solana (SOL).

Footprint analysis: trading volume and FTM price

However, Fantom’s rapid growth has seen a turning point when the airdrop ended on January 25. Why?

Some thoughts on Fantom’s current problems…

Excessive reliance on celebrity influence

Fantom has seen incredible growth in recent months. However, it was driven almost entirely by Cronje’s support. This leaves you vulnerable in case things don’t go your way in the protocol.

Lack of attractiveness of the ecosystem

Also, although its performance is good, there are not many new projects in Fantom. Any project ecosystem needs a constant stream of fresh new projects to keep growing.

Fewer validation nodes

Solana has 1000 validator nodes and Terra has 100. Fantom has only 50, relatively few on Top’s mature public chains. Which results in the relatively low global, leaderless and trustless nature of Fantom. It means that decentralization is not high enough to attract DeFi protocols, which affects TVL. This is why Fantom needs to add validation nodes.

In short, if Fantom wants to sit in the second or even the first position of the public chain, the above problems must be solved in a good way.

What is footprint analysis?

Footprint Analytics is an all-in-one analytics platform for blockchain data visualization and insight discovery. Cleans and integrates on-chain data so users of any experience level can quickly get started investigating tokens, projects, and protocols. With over a thousand dashboard templates plus a drag and drop interface, anyone can create their own custom charts in minutes. Discover blockchain data and invest smarter with Footprint.

January 2022, [email protected]

Data source: footprint analysis Phantom board

Posted in: Bitcoin, Analysis

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This post What has caused Fantom’s ups and downs?

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