The Fantom Foundation, which controls the Fantom Level 1 blockchain network, has fulfilled significantly reducing the validator’s staking requirement. This change, confirmed by the foundation in a January 15 post and following a governance vote that ended in June 2023, marks a strategic shift in Fantom’s approach to network security and decentralization.
Previously set at 500,000 FTM tokens, the staking threshold for validators on the Fantom network has been drastically reduced by 90% to 50,000 FTM, equivalent to approximately $19,500 at current market rates. The move aims to improve the security of the network by increasing the number of validators, thereby making it more challenging for malicious actors to compromise the network.
The rationale behind this decision is based on the principle that a larger number of validators strengthens the resilience of the decentralized network against attacks. Validators on the Fantom network play a crucial role by merging transactions and sharing them with other validators, with finality being achieved after reaching a consensus of at least two-thirds of them. The foundation claims that this increase in validators will speed up transaction validation without compromising network speed or security, maintaining 1-2 network seconds to completion.
In addition to improving security, this reduction in the staking requirement democratizes access to validator status, allowing more participants to contribute to the operation of the network. Despite this change, the foundation assures that network performance will not be negatively affected, as the security and efficiency of transaction validation remains proportional to the amount staked by validators, not the number of validators themselves. Therefore, a larger validator with a higher stake has the equivalent power of several smaller validators with smaller stakes.
This initiative of the Fantom Foundation is not the first of its kind. The discussion surrounding lowering the minimum FTM requirement to launch a node started as early as February 2022. According to recent data, the Fantom network consists of 58 validators, a modest figure compared to larger networks such as Ethereum, which boasts over 1.1 million validators.
Despite the positive implications for network security and decentralization, recent changes have not significantly affected the market performance of FTM. At the time of writing, the price of FTM is down 1.4% on the day, trading at $0.389. This decline is part of a broader trend, with FTM prices down 89% from their peak in October 2021.
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