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Fantom (FTM), a leading Layer 1 (L1) blockchain platform, has launched a new Gas Monetization program to incentivize high-quality Decentralized Applications (dApps) and attract top talent to the ecosystem.
With the recent announcement of the long-term vision for the protocol by Andre Cronje, co-founder of the blockchain platform, the community is buzzing with excitement for the future of Fantom.
Fantom’s Gas Monetization, which just went live on May 28th, is one of the most highly anticipated updates for the platform. The governance proposal was first approved in January 2023, with an overwhelming 99.8% of the votes, showcasing the community’s support for the initiative.
Fantom Launches Gas Monetization Program
Gas monetization is an incentive program to reward high-quality dApps for their generated fees. These dApps will receive a 15% kickback on all the gas fees generated, incentivizing development and attracting more developers to the ecosystem. The money for this reward comes from the fact that the FTM burn rate will be reduced from 20% to 5%.
This is a win-win situation for both developers and the Fantom network. Developers are compensated for the value they create on the network, while the network benefits from increased adoption and usage. The reduction in the FTM burn rate also helps control inflation and gives more stability to the token’s value.
Francesco, a leading figure in the blockchain industry, remarked that this incentivization of development is exactly what Fantom needs to achieve its goals. With Gas Monetization, the platform is taking a significant step forward to become one of the leading L1 giants in the blockchain industry.
However, the mechanism could be targeted by spam dApps and malicious actors trying to exploit it. To prevent such exploits, Fantom has implemented certain criteria that dApps must meet to be eligible for Gas Monetization.
Fantom’s Eligibility Criteria
A dApp must have completed at least 1 million transactions and been live on the Fantom network for at least 3 months to be eligible. These criteria are valid for each smart contract on the Fantom mainnet and may be subject to change during the program based on their effectiveness.
Once approved for the program, dApps will receive 15% of the gas fees they generate. The FTM tokens received are unlocked and can be used as the dApps see fit. However, what happens to the 15% share of gas fees made by dApps that do not participate in the Gas Monetization Program?
These transactions are ineligible and do not qualify for the 15% share of gas fees. The Fantom Foundation has clarified that only dApps that meet the eligibility criteria can participate in the Gas Monetization Program and receive rewards for their contributions to the network.
The Foundation also reserves the right to suspend rewards to participating dApps for any necessary reason, including fraudulent user activity or the overall well-being of the Fantom ecosystem.
The Gas Monetization Program is a great opportunity for dApps to showcase their value and be rewarded for their contributions to the network. However, ensuring that spam dApps or malicious actors do not exploit the program is essential.
This new approach is just a series of incentives Fantom builds to attract developers and keep them engaged with the ecosystem. The platform’s long-term vision includes creating a decentralized finance (DeFi) ecosystem that is fast, secure, and user-friendly, with various dApps and tools that make it easy for users to interact with the network.
Featured image from Unsplash, chart from TradingView.com