Blockchain
Fantom DeFi Rises 20% As Sonic Update Launches – DL News
- Fantom is on the verge of a major update.
- The once-thriving blockchain has had its best week since details of that update were revealed in March.
Investors are pouring money into Fantom’s troubled blockchain ahead of Sonic, a major update that is expected to bring improved performance and a series of airdrops.
Fantom’s token, FTM, has risen 25% since validators, the distributed network of computers that manage the blockchain, began updating their software on Tuesday.
Since Monday, the total value of cryptocurrencies deposited in Fantom’s DeFi ecosystem has increased by 20% to $147 million, according to data from DefiLlama.
Fantom was affected by the July 2023 hack of the Multichain crypto bridge.
Once the upgrade is complete, Fantom will process up to 2,000 transactions per second and offer enhanced, streamlined security liquid stakingand finally, greater productivity using zero knowledge technologyMichael Kong, CEO of the Fantom Foundation, previously said DL News.
Fantom currently processes a maximum of 200 transactions per second, according to the Fantom Foundation.
Furthermore, some users will qualify for airdrops, according to Kong.
“The more you interact with the network, the more value you accumulate in the network, that will lead to a higher airdrop,” he said.
Kong declined to share further information about upcoming airdrops to avoid attracting mercenary users looking to “game” the blockchain.
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Two-thirds of Fantom’s 60 validators must upgrade for Sonic to have an effect on the entire network. As of Friday, 25 validators had updated their software.
The update will test whether Fantom can return to prominence after a devastating attack dried up a related protocol in 2023.
Founded by infamous DeFi advocate Andre Cronje, Fantom was once a top five blockchain with nearly $8 billion locked in its DeFi ecosystem.
It has been heralded as an “Ethereum killer,” along with other low-cost, high-speed networks such as Avalanche, Solana, Terra, and Tron.
Like the rest of the cryptocurrency economy, it collapsed after Terra’s collapse in 2022.
Another blow was dealt last July, when the cryptographic multichain “bridge” suffered an apparent cyberattack.
Multichain said $125 million in cryptocurrencies were anomalously transferred to “unknown addresses.” The company also confirmed rumors that its co-founder had been arrested by Chinese police in May.
So-called bridges like Multichain allow the transfer of tokens between otherwise incompatible blockchains.
The hack rattled Fantom users, many of whom had used Multichain to bring assets from other blockchains to Fantom.
Users would send crypto tokens like Ether or USDC to Multichain. The protocol would then mint a Fantom-compatible version of the deposited tokens for use on Fantom.
When cryptocurrencies stored on Multichain were stolen, many assets on Fantom were effectively left unsecured.
The total value of cryptocurrencies locked in Fantom was around $260 million shortly before the hack. Until Kong introduced Sonic in March, his price tag had remained under $100 million.
Aleks Gilbert is a New York-based reporter covering DeFi. Do you have advice? Send him an email at aleks@dlnews.com.