Interoperability became the hot topic in February as platforms such as Binance Smart Chain and Polkadot work to build Ethereum network bridges that allow users to escape high transaction costs and network congestion.
Fantom (FTM) is the latest project to receive a boost by offering cross-chain functionality with Ethereum, and data from TBEN Markets and TradingView shows a 1570% increase in the FTM price from $ 0.025 on January 23 to a new peak of $ 0.43 in February. 21.
Three fundamental reasons for Fantom’s current rally are the publication of a cross-chain bridge between Ethereum and Fantom, the deployment of on-chain governance features, and the ability to stake tokens on the network while continuing to access their value. for use in the decentralized sector. the financial ecosystem.
Yearn.finance Helps Facilitate a Cross Bridge to Ethereum
On February 21, Fantom, with the help of André Cronje from Yearn.finance, ad the development of a cross bridge with Ethereum that allows users to transfer ERC-20 tokens to Fantom to “take advantage of fast and cheap transactions”.
According to the team, transactions on Fantom “get confirmed in 1-2 seconds” and “cost a fraction of a cent”. The team also promised that cross-channel functionality with other channels will follow soon.
TBEN Markets Pro’s VORTECS ™ data began to detect a bullish outlook for FTM on February 21, ahead of the recent price hike.
The VORTECS ™ Score, exclusive to TBEN, is an algorithmic comparison of historical and current market conditions derived from a combination of data points including market sentiment, trade volume, recent price movements and Twitter activity .
As shown in the chart above, the VORTECS ™ score for FTM hit a high of 74 in early February 21, shortly before the price hit a new all-time high.
Chain governance stimulates community participation
Another popular theme in the current bull market is the ability of token holders to participate in ecosystem development through a governance mechanism.
On January 12, the Fantom Foundation unveiled the exit of on-chain governance for the Fantom network, becoming one of the first chains to support such an operation for a fully decentralized blockchain.
Through the governance mechanism, each FTM token equals one vote, and any token holder can submit a proposal on ways to improve the ecosystem, as well as vote on any pending proposal.
Proposal submissions cost 100 FTM, which is burned during the operation, and voting costs a fraction of 1 FTM.
The Fantom voting system differs from other governance platforms in that it offers a variety of proposal models and the ability to express the degree of agreement with the proposal as opposed to a simple “yes” or “no” vote. .
Fantom plans to integrate staking and DeFi features
A third motivating factor behind the recent price hike of the FTM is the introduction liquid staking, or the ability to wager tokens on the network and simultaneously access the token value for use in DeFi.
On most Proof of Stake networks, token holders must choose between wagering their tokens to secure the network and earning rewards or forfeiting those rewards to access the value of the token as collateral or for commercial purposes.
FTM holders can wager their tokens on the network and strike an equivalent amount of sFTM, which can then be used as collateral on the Fantom Finance DeFi platform.
Providing token holders with an additional way to earn a return turned out to be a great incentive, and after FTM was listed on SushiSwap and 1 inch on January 25, its price exploded from $ 0.05 to $ 0.26. USD over the next three days.
Since then, FTM has been added to Coinbase Custody and Ledger Hardware Wallet, and has been chosen by the Ministry of Digital Transformation of Ukraine as the platform for the exchange of intellectual property.
Each of these developments support the strong breakout of the FTM price, and the upcoming public release of its Ethereum cross bridge has placed Fantom in a good position to receive a new level of DeFi engagement. Additionally, the prospect of transaction fees of less than $ 0.01 can be a tempting incentive for crypto traders and could lead to liquidity migration.
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