Fantom ICO Review
All blockchains are processing transactions in its core. As more adoption comes to the market, so more transactions will occur and not any blockchain may process such increased number of transactions. For instance, Ethereum blockchain is processing 10 transactions per second (TPS) (according to etherscan.io), Bitcoin blockchain processing only 2.1 TPS (according to blockchain.info). It is very low transaction’s speed in comparison with existing centralized solutions like Visa (24 000 TPS) and to solve the problem of transaction speed, Fantom Foundation has been formed.
Their solution will use DAG (Directed Acyclic Graph) methodology to process all transaction within the system. Using of DAG is providing following advantages:
- Real-Time transactions (~0 sec. confirmation)
- Transactions are processed asynchronously
There is no miners and blocks in the traditional sense, all transactions are processed by nodes, which are working asynchronously with increased confirmation time. It means that nodes are not working together to confirm the current block, but receiving different transactions at a time and process them one-by-one. Scalability will strongly depend on the number of supported nodes in the system. To achieve the network consensus, Fantom Foundation introduces its own algorithm, called – Lachesis Protocol.
Architecture of the system
The future Fantom OPERAtm chain will have three different layers:
- OPERA core layer – it will create events and maintain the network consensus amongst all nodes using their own Lachesis Protocol.
- OPERA ware layer – it will be responsible for payment functionality and other activities occurring on the Fantom blockchain.
- OPERA Application Layer – it will be an interface (API) to communicate with the Fantom blockchain and creation of DApps
To create your own DApps working within the Fantom ecosystem, they are introducing their own SCALA-like functional programming language which will be executed within Fantom Virtual Machine (FVM).
For whom it may be useful
All facts about Fantom projects made us curious, but to realize the potential of the product we have to assume its use cases first. Let’s try to do this. First of all, what is the end product of Fantom Foundation? It is a high-speed and near zero fee blockchain, based on DAG architecture without miners and with its own consensus mechanism. So, basically, Fantom provides an infrastructure which may be used for systems with high-load. It’s not limited to any particular industry and may be used by any kind of business which needs its capabilities. We may compare it to Visa or Mastercard processing systems, but based on blockchain with its low fees.
The best use case for Fantom (OPERA) blockchain is the banking. In this field, transaction’s speed is very important and to compete with Visa or Mastercard, they have to achieve higher transaction speed (which is around 24 000 TPS for VISA). According to the Fantom Foundation plans, they are going to perform around 300 000 TPS and all with instant confirmation. To become more attractive for banks, they should have at least 25 000 TPS. If they will be able to achieve this milestone, they will become very popular within the banking industry.
Their TestNet should be accessible on 15th of June and only after that, we will be able to check their performance statistics.
Fantom Foundation will introduce its own token – FTM – which will be used for incentives and access to their network. Firstly, FTM tokens will be issued on the Ethereum blockchain (ERC-20) to conduct crowdsale of the project. Later on, when MainNet will be launched, these ERC-20 FTM tokens will be exchanged for their native tokens. Token Metrics, available now:
- Total token supply: 3 175 000 000 FTM.
- Tokens for crowdsale: 1 270 000 000 FTM (40%).
- Hard Cap: 39 800 000 USD.
Additionally, Fantom Foundation declared that their tokens will have an inflationary model. Initially, the inflation rate will be 5 % annually. Part of the inflation amount will be used to provide incentives for FANTOM ecosystem users.
The private round has been oversubscribed and closed successfully.
Team of the project
According to the Fantom’s website, they have very big and strong team. Entirely, there are 27 people, mentioned on the website as a team member. We’ll be going through their executives, to determine their previous experience and skill set.
- Ahn Byung Ik – CEO of the project. According to his LinkedIn profile, he graduated from the Yonsei University (South Korea) in 2007 as a PhD and was studying at Stanford University as an exchange student. Previous experience includes positions in telecom and FMCG companies, alongside with his own projects.
- Bob Tucker – COO of the project. He is a very experienced manager and his working experience includes positions in such famous companies as Barclay’s Capital and KPMG. His skill set is verified by a lot of people which means that he is highly skilled professional able to achieve success.
- Sean Yun – CFO of the project. His LinkedIn is questionable. Only previous experience is filled, but no skills and recommendations received. Due to the lack of information, we can’t provide a detailed analysis of his working experience and current capabilities.
- Issac Lee – CIO of the project. He is young. Working experience is not too long and includes mostly advisory positions at several ICOs and latest place is at BlockWater Capital as a General Partner. By the way, BlockWater Capital is mentioned as an early investor in Fantom Foundation.
- Joseph Jang – CSO of the project. His working experience has started in 2009 as a freelancer in video production. Later on, he was working as a business developer in South Korea and the latest place is SL Blockchain Partners, which is also mentioned as a partner of the project. His skill set mostly consists of video production related skills. Not sure how it may be useful at his current Chief Strategic Officer position.
- Jake Choi – CMO of the project. His working experience mostly was in data analysis and research. His skills are also verified and trusted. As a CMO, Jake will coordinate all marketing actions of the Fantom Foundation and on our point of view, his research and analytical skills may be extremely useful to create an effective marketing campaign.
So, everyone in the executive team has LinkedIn profiles and their experience is trusted and verifiable. There are few questions regarding their skill set and previous experience, which we have already addressed to the official Fantom email. But after 3 business days, we haven’t received an answer.
Besides the executive team, Fantom Foundation has an “army” of developers, responsible for delivery of the final product. Developers’ LinkedIn is mostly empty and their previous experience cannot be verified. Our team has tried to reach them out, but no results.
Roadmap and current state of the project
RoadMap of the project includes 5 stages. It starts from Q2 2018 (15th of June), when crowdsale and pre-sale will be conducted and the last step is Q2 2020, when additional services of the Fantom Foundation will be launched (e.g. research support agency launch).
Currently, a project is at its infancy stage and active development is in progress. We should see first results only at 15th of June (as a minimum) and then we will realize current state of the project’s development.
Fantom Foundation is a project which is going to develop their own blockchain infrastructure with an extremely high transaction’s speed (~300k TPS) and, as we suggested before, has a lot of areas of application. In terms of the banking industry, the biggest and the most successful (for now) competitor is Ripple (XRP). They are already working with famous financial companies, such as MoneyGram. Moreover, recently, Ripple has been chosen by the consortium of South Korean banks to implement their blockchain within their internal systems. Currently, Ripple processes only about 18 transactions per second (TPS).
There are several other blockchains which are already working and may handle much more TPS and they will be also direct competitors to the Fantom Foundation. For example, NANO (ex. RailBlocks) is currently declared that they may process around 7 000 TPS. Their success is only a matter of time if they are able to cover 7k TPS.
- The idea and implementation of the project are clear and have strong potential. Their target amount of TPS (txns/sec) is very high and if they will be able to reach it, their blockchain will become the most attractive in comparison to other competitors on the market.
- Fantom Foundation has an “army” of developers. 16 members are dedicated only to the platform development.
- Hype rate of the project is between “Above Average” and “High”. We expect growth in their hype rate, closer to the dates of Pre-Sale (25th of May) and Crowdsale (15th of June).
- Fantom is developing and will later use its own consensus mechanism – Lachesis Protocol.
- DAG architecture will be implemented to increase transaction speed.
- Long-term success strongly depends on the number of supported nodes in the system. More nodes – higher transaction speed.
In short and middle terms, we think that project will close their hard cap due to its hype rate, but the question is how many “flippers” will go in and will they sell their tokens right after exchange listing or not.
At ICOguru, we consider Fantom Foundation as a long-term investment. Because, until the release of, at least, TestNet we cannot identify ecosystem capabilities. So, we expect a huge increase in the price of FTM tokens right after its first load tests.