Can FLOW seriously compete with Ethereum?
The obsession with collecting has reached the blockchain space: cryptocurrencies collectibles - from works of art to tokenized models - are achieving high prices, trading venues for non-fungible tokens are growing rapidly and even the big daily newspapers have now noticed that something is in the bush. Another effect of the trend: the prices of crypto tokens with an NFT focus have performed above average since the beginning of the year.
In order to achieve scalability at the mainstream level, the Flow system relies on a process that comes from PC science: pipelining. Put simply, pipelining describes the period of breaking down commands into subtasks. In this way, the computing efficiency of a CPU is significantly increased. Flow makes use of this concept by transferring this division of labor to a system. There are four different types of nodes at Flow, each of which specializes in different subtasks.
The FLOW token serves at the same time to secure the system and as an incentive for the validator node: These earn FLOW by performing their tasks in the network. Another source of income are the transaction fees that are incurred per network and are also paid out with each block. Those who do not use a validator node themselves can participate in staking by delegating FLOW tokens to a validator.
So far, staking has been the main use case for FLOW. The proportion of coins staked in the system is currently correspondingly high. At the time of writing, 80 % of all FLOW tokens are staked. This means that FLOW is still far from the 40 % that was targeted as the average value for the first year and a half after the launch of FLOW.
The contents of this article are for informational purposes only and are not investment advice.