Fantom Becomes the Third Largest Blockchain in DeFi, Overtaking BSC’s TVL

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Altcoins
Fantom Becomes the Third Largest Blockchain in DeFi, Overtaking BSC’s TVL

According to DeFiLlama, Fantom has surpassed Binance Smart Chain (BSC) to become the third-largest blockchain in decentralized finance (DeFi). Over the last week, Fantom’s TVL outperformed the global crypto market, rising more than 60% to US$12.2 billion.

Fantom Exceeds Expectation

Based on data from Santiment, an on-chain data source, the FTM funding rate on platforms such as Binance is becoming negative, signaling heavy shorts. However, these shorts have severely burned their fingers throughout this strong price rebound.

Fantom was selling at roughly $0.026 in January 2021. It then rose to $3.16 by November 2021. At the time of publication, the most recent closing price was $2.07. Fantom is an open-source smart contract blockchain that hosts 6.15 percent of the approximately $200 billion in DeFi activity.

This increase surprised Fantom because the DeFi network had dropped to $7.9 billion just 48 hours before. However, its 129 protocols successfully pushed the boundaries, driving the TVL by 60% in the next two days.

Even though the network has been performing well, broader market cues have influenced the token’s performance. With a 40.6 percent drop in 5 days, the altcoin has only held above the critical support level of $1.8902.

Although folks witnessed a 15.8 percent recovery green candle yesterday, the charts repainted a red candle since FTM was down by 8.62 percent at this report.

Finally Outperforming Binance

Because it uses the DAG-based smart contract framework for DApps, Fantom is developing as a speedier competitor to other Ethereum Layer 1s. Fantom likewise positions itself as a less expensive and quicker Ethereum Layer 1 alternative.

For example, with transaction costs as low as $0.0000001, Fantom takes only 1s to transmit money. The average transaction time on Ethereum is 15 seconds, and the average transaction fee is $3. Furthermore,  FTM, Fantom’s native token, can be used for various functions, including staking, payments, and governance.

Interestingly, Binance Smart Chain’s gas cost utilization has been substantially lower than Fantom’s in terms of DeFi. According to gas trackers, BSC’s regular fees were 5 Gwei, whereas Fantom’s standard fee was close to 807 Gwei.

However, Fantom’s $0.2 network transaction costs were lower than Binance Smart Chain’s $0.32. As a result, this could motivate investors to jump on Fantom, but whatever the reason, Fantom is looking to solidify its new position.

Who is Building on Fantom?

Meanwhile, experts and investors are bullish on Fantom’s prospects in 2022. FTM is undervalued, according to Austin Barack of Coinfund. Mr. Barack credited Fantom’s potential upside to its technological supremacy and extensive community programs aimed at aggressive dApps onboarding.

Multichain, SpookySwap, and OXDAO are the most popular among the 128 protocols operating on Fantom (FTM) as of January 2022.