The 2020 pandemic, with its numerous lockdowns, caused us to shift even closer towards a remote work-and-play lifestyle than we had been previously. Blockchain gaming has become a significant aspect of this way of life, having brought in over a quarter-billion dollars in the first half of 2021 alone.
However, this deluge of interest has caused developers to rethink the technologies they had been using to build gaming platforms. Let’s take a look at one protocol that was born from this reevaluation, the Flow blockchain.
The Flow blockchain was built with video games and virtual entertainment in mind. It’s a new kind of ledger seen as an alternative to the Ethereum blockchain.
Dapper Labs, those behind the CryptoKitties blockchain game that saw unprecedented popularity in 2017, are also the creators of Flow. Formerly known as Axiom Zen, Dapper Labs unveiled Flow in 2019 after announcing an $11 million funding round led by investor behemoth A16z.
The team behind Flow is based in Canada and led by founders Mikhael Naayem, Roham Gharegozlou, and Dieter Shirley. They created the protocol to increase scalability, lower costs, and improve upon the consensus mechanism used by other blockchains.
The goal of the developers when designing Flow was to address the issue of scalability while also retaining decentralization and high security. The goal of nearly every blockchain protocol. The Dapper Labs team was forced to find a solution to the scalability conundrum following the success of their Cryptokitties project. Users were flocking to the game in such numbers that Ethereum was unable to keep up.
Flow saw the project on its way to its goal in 2019, as the prototype was already able to handle around 1,000 transactions per second (TPS). In comparison, the throughput of the Ethereum network is only around 13-15 TPS, which makes it unsuitable for large-scale usage. The vision is for the Flow system to reach 10,000 TPS.
Blockchain users are required to pay fees to complete transactions and successfully execute smart contracts, known as gas fees. A gas fee is a one-time charge based on the complexity of the contract and how busy the network is.
On the Ethereum network, these gas fees are paid in ETH tokens. The average cost keeps climbing as the value of Ethereum increases. At the time of publication, this average fee is equal to about 0.0055 ETH, or the fiat equivalent of around 10 USD (over 12 CAD).
The creators of Flow were unhappy with the expense of gas on Ethereum. Not wanting to compromise affordability, they found a solution that is able to tear transaction fees to shreds.
On the Flow blockchain, two expenses are involved with transactions: one for creating an account (0.001 FLOW ~3cents), and the other for executing contracts (starts from 0.000001 FLOW ~1 penny). Fees such as these make Flow virtually free to work with.
The Flow blockchain is powered by the FLOW cryptocurrency. Developers can use FLOW as the primary currency for transactions and earn rewards in their decentralized applications (dApps). If they wish, developers can also create their own custom cryptocurrency on Flow, though they do have to pay fees in FLOW.
Users must own and stake FLOW tokens to become a node. A node is a computer connected to the Flow network. This computer relays transactions to other nodes on the network. It requires an always-on internet connection as well as keeping your Flow client running. Flow rewards these users with newly minted FLOW as well as a portion of the transaction fees.
On the Flow blockchain, there are four major types of nodes: collection, consensus, execution, and verification nodes. To increase efficiency, each node participates in the validation of every transaction by splitting tasks.
Cadence is a smart contract-specific programming language. A robust static type system, built-in pre- and post-conditions for functions and transactions, and the use of capability-based security are just a few of its features. Cadence's syntax was influenced by Swift and Rust, two of the fastest programming languages. This was created to be developer-friendly.
Beyond the Cryptokitties project, which led to the development of the Flow blockchain, more successful projects are rising through the ranks. They include games, marketplaces, and decentralized finance exchanges (DEX’s), such as:
Chainmonsters - Cross-platform, massively multiplayer RPG in which you capture, fight, trade, and compete with digital monsters across multiple platforms.
BloctoSwap - First decentralized exchange on the Flow Blockchain.
Blockparty - A premium NFT exchange that now fully supports the minting and trading of NFT’s on the Flow blockchain.
Both Flow and its programming language, Cadence, make it easy to develop dApps with viral potential. Applications that allow musicians and athletes to engage with their fans are just two examples of types of NFT projects that involve well-known celebrities and spread through the community quickly.
As the popular saying goes, the future begins now. Albeit, right now the world is still working and pretty much playing from home. Hence, we should see more innovation and growth in products that cater to this lifestyle, especially in the blockchain space. The reason is not far-fetched. In less than a year, Flow blockchain has grown from an idea to being worth billions (nearly CAD 6.1 billion as of this writing). With its adoption by developers, and many use cases, Flow will certainly have a place in this new normality we are living in.
Invest With Confidence
Coinberry has a Financial Institution Bond.
We hold ourselves to the highest standards of financial regulation and have explicitly protected our investors against financial losses due to dishonest acts and unethical behavior from Coinberry employees.