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Ethereum Vs. Fantom – What’s the Difference?
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Learning the differences between Ethereum (ETH) and Fantom (FTM) can be an important step to becoming a more informed trader. Both of these platforms were built to provide a new level of programmability to blockchain developers. However, since these protocols were launched at different times, they are meant to tackle inefficiencies in different networks. Here’s everything you need to know about Fantom vs Ethereum.
What is Fantom?
Fantom (FTM) is a third-generation advanced blockchain. The protocol differs from its predecessors due to the use of Directed Acyclic Graph (DAG) based smart-contracts. The main advantage of this approach is top-notch performance. The goal of the Fantom project was to improve the programmability and flexibility provided to Dapp developers at the time.
The protocol specifically targets Ethereum developers who suffer from high gas fees and programmability restrictions due to the early nature of the network. Notably, Fantom’s developers envision the protocol operating like a central nervous system for smart cities and other web 3.o applications in the future.
What is Ethereum?
Ethereum was the first second-generation blockchain to enter the market. The protocol changed the game with the introduction of smart-contract programmability. Ethereum was founded by Vitalik Buterin. It improves on its predecessors by enhancing scalability and functionality. The main difference is that Ethereum was designed to overcome Bitcoin’s shortcomings whereas Fantom focuses on Ethereum’s issues.
Ethereum was one of the first cryptocurrencies to hit the market. The protocol revolutionized the sector as the first smart contract programmable platform available. Ethereum has remained a pioneer in the sector. In 2017, they made the ERC-20 token standard which ushered in the 2017 crypto revolution and ICO (Initial Coin Offering) movement.
Ethereum has endured SEC investigations and a constant bombardment of competitors. Despite its technical limitations, the Ethereum ecosystem operates as the largest Dapp and DeFi environment in the world. As such, nearly all new blockchains include smart contract programmability.
What Problems was Fantom Built to Alleviate?
Fantom seeks to transform the market through its technical advantages. The system provides users access to an all-in-one DeFi ecosystem. This approach makes it easier for new users to enter the market. In this way, Fantom seeks to improve adoption rates. Fantom reduces gas fees for both developers and users. Gas fees are the cost of paying network nodes to conduct transactions and execute smart contracts. Comparingly, Fantom users pay much lower fees than Ethereum due to the network’s consensus mechanisms and structure.
The protocol has near zero fees for transactions making it an ideal selection for Dapps users. Additionally, Fantom is more energy efficient than Ethereum. The developers took great care to make Fantom sustainable. As part of this strategy, it does away with power-hungry miners. Eliminating miners makes the network have a much smaller carbon footprint compared to PoW (proof-of-Work) networks.
What Problems was Ethereum Built to Alleviate?
Ethereum tackled many of the biggest problems of 2013-2014. At that time, cryptocurrencies were just that – currencies which served little other purpose. Buterin saw a need to provide programmability to these powerful computer networks. Ethereum introduced the first affordable blockchain infrastructure solution to the market.
Ethereum was ahead of its time. When it launched, Bitcoin had set the benchmark at 7 transactions per second. Ethereum doubled that at around 14 tps. The network was also much cheaper to transact on because Bitcoin suffered from crushing congestion prior to its SegWit upgrade and the introduction of the Lightning Network.
One of the biggest issues that Ethereum conquered was the anxiety of developers converting from centralized systems to decentralized networks. Ethereum showed that these protocols could be hosted securely and create revenue. As the demand for Ethereum Dapps grew, so did the developer community. Today, Ethereum users enjoy more options and functionalities than the competition.
How Does Fantom Work?
Fantom was designed utilizing a multi-layered approach. This strategy is common in third-generation and newer blockchains. The system leverages a layer called the Opera Core to remain valid. This layer is where the nodes validate transactions and add them to the ledger. The next layer is the Opera Ware Layer.
The Opera Ware Layer serves a vital role as the execution protocol. This layer is where rewards and payment data go. The layer’s Story Data system improves the performance of the network by reducing the number of nodes needed to verify transactions. It streamlines tracking the past actions of the network as well. The Application Layer is where most users will interact with the network. This layer enables access to the rest of the network. It is also responsible for interactions such as APIs and Dapps.
One of the coolest features of Fantom is fMint. This system makes it easy to create new digital assets. Additionally, Fantom leverages a multi-token environment. The network uses FTM as its utility token. There is also sFTMs that operate as synthetic assets. Lastly, fUSD is the network’s stablecoin. Together these assets enable users to enjoy full DeFi capabilities when using the protocol.
How Does Ethereum Work?
Ethereum is currently a PoW protocol. The network relies on miners to approve transactions and the overall state of the blockchain. Miners receive rewards for their efforts in the form of Ether (EHT), the network’s utility token. Ethereum is in the midst of its largest update yet, ETH 2.0.
The upgrade would convert the network to a PoS (Proof-of-Stake) protocol. This maneuver would eliminate the need to use miners and improve the scalability of the network. Notably, you need to stake 32 ETH to become a validation node. Those who want to participate, but hold less ETH, can use staking pools to still gain exposure to the profits.
Ethereum developers can create using a variety of token standards. The ERC-20 token standard is by far the most popular. There are hundreds of thousands of ERC-20 tokens in circulation currently. The network also supports NFTs, security tokens, and more. One of the things that make Ethereum so successful is its sheer selection. The size of the network is unmatched.
How to Buy Ethereum (ETH) and Fantom (FTM)
Currently, Fantom (FTM) and Ethereum (ETH) are each available for purchase on the following exchanges.
Kraken – Founded in 2011, Kraken is one of the most trusted names in the industry with over 9,000,000 users, and over $207 billion in quarterly trading volume.
The Kraken exchange offers trading access to over 190 countries including Australia, Canada, Europe, and is our most recommend exchange for USA residents. (Excluding New York & Washington state)
Bitstamp – Founded in 2011, Bitstamp is one of the oldest & most trusted exchanges in the world. This exchange currently accepts Canada, UK & USA residents excluding the states of Alabama, Hawaii, Idaho, Louisiana, Nevada, & New Jersey.
Uphold – This is one of the top exchanges for United States & UK residents that offers a wide range of cryptocurrencies. Germany & Netherlands are prohibited.
Uphold Disclaimer: Assets available on Uphold are subject to region. All investments and trading are risky and may result in the loss of capital. Cryptoassets are largely unregulated and are therefore not subject to protection.
Binance – Best for Australia, Canada, Singapore, UK and most of the world. USA residents are prohibited from purchasing most tokens. Use Discount Code: EE59L0QP for 10% cashback off all trading fees.
Fantom Vs. Ethereum – Features vs Size
It’s interesting to note that these protocols both offer full programmability to developers. The advantages of each are obvious now. Ethereum provides added liquidity as the most popular option in the market whereas, Fantom reduces costs and improves functionality. In terms of long-term trading potential, Ethereum has proven to be a strong addition to any portfolio. Additionally, Fantom has some features that make it an interesting project to watch. As such, both networks are worth monitoring for 2022.
To learn more, make sure to visit our Investing in Fantom and Investing in Ethereum guides.
David Hamilton is a full-time journalist and a long-time bitcoinist. He specializes in writing articles on the blockchain. His articles have been published in multiple bitcoin publications including Bitcoinlightning.com
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