Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

Introduction

Speed, security and decentralization. These are the three key factors surrounding the blockchain. This is called the trilemma of the blockchain. There are trade-offs between these three, and it is considered impossible to achieve all of these at the same time. However, when Fantom arrived, everything changed. Fantom was established to master all these three elements, and it has already set off a storm in DeFi while struggling to achieve impossible goals.

What is Fantom?

Fantom is a highly scalable blockchain platform for DeFi, cryptocurrency DApps and enterprise solutions. It is designed to overcome the limitations of the old blockchain, using Lachesis, a customized asynchronous Byzantine Fault Tolerance (aBFT) consensus mechanism, to make Fantom faster, more scalable, and more scalable than other blockchains that operate on previous consensus algorithms. Safety.

In order to cope with the multi-chain future, Fantom will incorporate various chains into its network through its bridge, such as Ethereum , BSC, Polygon and Avalanche. The main Ethernet Square project, such as SushiSwap and Curve have migrated to Fantom, drive traffic into their chains. However, it is SpookySwap, Fantom’s first native farm and AMM DEX that have gained huge popularity , second only to AnySwap in the TVL rankings, and surpassed Curve and Beefy Finance.

Trading and Gas

Since the boom of the DeFi summer in 2020, we have witnessed how much gas prices on Ethereum fluctuate due to congestion in the base layer. This increase in demand forces users to bear expensive transaction fees and makes it difficult for developers to encourage participation. From the graph, we can see that in the past 2 years, the median gas price has risen, which has given birth to a much-needed solution that is scalable and compatible with Ethereum.

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

At the scale of construction, each network on Fantom is independent of each other. As a network, the operation of the network improves performance and reduces congestion. In addition, Fantom’s mainnet uses the Ethereum Virtual Machine (EVM) to make it compatible with Ethereum. These compatibility enables developers to quickly move over and experience performance improvements and cost reductions.

As shown in the figure below, it is fascinating that the number of transactions on Fantom surpassed Ethereum in September 2021, after announcing its incentive liquidity mining plan of $370 million at the end of August. However, the daily gas payment on Fantom is still much less than the Ethereum network because it was built for lower transaction costs.

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

Contract deployment activities

Together about deployment activities on project development block chain is a good indicator. Compared with the Fantom blockchain, the level of these activities on the Ethereum blockchain is usually higher because there are currently more projects built on Ethereum.

This phenomenon can be seen in the figure below, which shows the number of contracts deployed on Ethereum and Fantom. In early June, Ethereum reached its peak, with more than 240,000 contracts deployed in a single day. However, deployment activities have since declined and stabilized below 20,000 copies per day. On the other hand, after Fantom announced its incentive liquidity mining plan in early September 2021, its contract deployment activities peaked, with approximately 12.8 thousand contracts deployed every day. During this time, it should be noted that Fantom’s contract deployment activity is higher than that of Ethereum.

The contract deployment rate is calculated by dividing the contract deployment volume on Fantom by the contract deployment volume on Ethereum. We can see that the deployment ratio has been increasing over time, with a certain peak. When Fantom’s contract deployment activity flipped Ethereum, the ratio was 1.26. This means that for every Ethereum contract deployed, 1.26 contracts are deployed on Fantom. However, the main enlightenment from this data is that the overall deployment ratio for Ethereum follows a gradual upward trend, and the recent figure is hovering around 0.1.

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

Smart money 

If you are familiar with Nansen, you should now be familiar with our Smart Money label. Smart Money is a label of Nansen, including Smart LP, Flash Boys, Whales, Funds and others. Please see our definition of wallet tags.

Smart fund interaction is one of the possible positive indicators of a project/agreement because it shows the interest of experienced investors. Not surprisingly, as Fantom has become more and more popular, and large companies such as SushiSwap, Beefy Finance, and Curve have migrated over, data shows that quite a few smart fund addresses have set foot in Fantom and Ethereum.

From the figure, we see that Flash Boys (which has conducted multiple dex transactions in one transaction and is essentially a profitable wallet) has the largest overlap (24.2%) on Fantom and Ethereum. Not to mention that the overlap rates of smart LPs, others, and funds are 13.3%, 7.1%, and 0.9%, respectively.

If we compare these numbers with the numbers on the Binance Smart Chain, we can see that the overlap rate of smart funds on Fantom is much lower. Does this hint at the possibility that Fantom is still in the early stages of smart money adoption?

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

Stablecoin

On the Ethereum network, Tether (USDT) is the stable currency with the highest market value. It dominates the circulation of stablecoins with a huge advantage, where its trading volume is almost twice the sum of USDC and DAI . However, on the Fantom network, the dominant stablecoins are none other than USDC and DAI. USDT follows closely behind and ranks third. This shows that there is no dominant market leader in this field, and it will be interesting to see how it develops in the future.

Although the transaction volume of $USDC and $DAI on the Fantom chain are both among the best, it can be seen from the figure below that $USDC is far ahead in transaction volume and the number of daily active senders. This will show that USDC is the preferred stablecoin on the Fantom blockchain.

The surge in stablecoin activity on the Fantom blockchain shows that the adoption rate is gradually increasing, and September is an explosive month due to the announcement of an incentive liquid mining plan.

The increase in the number of stablecoins is a positive indicator, because it will mean that there is sufficient liquidity on the chain, allowing users to adopt more complex strategies. They have been doing it on the Ethereum mainnet, but the cost is only a small part, and the speed is obvious Faster. However, in late September, when the cryptocurrency market as a whole experienced a decline, the stablecoin activity on Fantom also followed the downward trend.

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

Value distribution of stablecoin trading volume

The average value of stablecoin transactions is a good indicator of the general capital/wallet size of Fantom users. It was found on Nansen’s stablecoin main dashboard that over time, the value distribution of transaction size paints an interesting picture.

In September, the trading volume and trading volume of the stablecoins on Fantom were very large. Interestingly, after the announcement, the proportion of large-value bills exceeding $100,000 has been rising. In addition, transactions of more than $1 million have consistently accounted for more than 90% of all transactions on the blockchain, which may indicate that huge whales have been attracted due to the incentives of liquid mining plans.

Emerging public chain Fantom: From a data perspective, the reasons for Fantom’s skyrocketing

in conclusion

With the rapid development of DeFi in the past 12 months, the question now is whether the current infrastructure can keep up with the growing demand. Many layer 1 and layer 2 solutions have proposed innovative methods to solve the various problems set by the operation of the blockchain on the previous consensus algorithm, and are fiercely competing for market dominance.

In early versions of these solutions, liquidity mining incentives were often used to stimulate usage, but as these incentives dries up, it is interesting to see which participant(s) in the market will appear at the top. Will Fantom be one of the more popular Layer 1 in the future?

About Nansen

Nansen is a blockchain analysis platform that enriches data on the chain through millions of wallet tags. Cryptocurrency investors use Nansen to discover opportunities, conduct due diligence, and defend their portfolios with real-time alerts.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/emerging-public-chain-fantom-from-a-data-perspective-the-reasons-for-fantoms-skyrocketing/
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