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Introduction to Flow Ecosystem and Its FLOW Token

UTC by José Oramas · 6 min read
Introduction to Flow Ecosystem and Its FLOW Token
Photo: Flow

The guide below explains functioning principles of Flow – a fast, secure, and developer-friendly blockchain built to support the next generation of games, apps, and the digital assets that power them.

Flow (FLOW) is a decentralized protocol with a unique multi-chain infrastructure where users can build crypto applications using a handful of features and tools that enhance usability, speed, and scalability. Flow’s blockchain is an Ethereum-based network designed to support internet-scale protocols and apps in order to ensure a user-friendly experience. The protocol has its own FLOW token used by validators, developers, and users to participate in the platform’s governance and earn rewards.

Creators of Flow

Dapper Labs developed Flow blockchain back in 2018. The company uses blockchain technology to experiment and bring new features for the crypto-community and the DeFi space. Its team includes former founder of Axiom Zen Roham Gharegozlou, CryptoKitties co-founder Dieter “dete” Shirley, Fuel founder Mikhael Naayem, as well as other tech experts.

Since the launch of Flow, Dapper Labs has been working to connect fans all around the world and give consumers the opportunity to become creators. Some of the partners of Dapper Labs include the NBA, Warner Music Group, and the UFC.

Features of Flow Blockchain

Flow has a multi-role infrastructure designed to serve billions of users globally. Its unique design allows a greater scalability without collapsing the network, thus achieving the required performance for mainstream applications without compromising its decentralization or sharding the system.

Multi-Node Architecture

Flow applies pipelining – a common technique that considerably scales up productivity by dividing the work of a validator into four roles:

  1. Collection. Collection nodes improve network connectivity and data availability for applications built on the protocol.
  2. Consensus. The consensus nodes are in charge of deciding on the presence and order of all transactions on the blockchain.
  3. Execution. These nodes are required to perform all the computation associated with every transaction.
  4. Verification. Verification nodes keep the Execution Nodes in check.

Consensus and Verification Nodes are the backbone when it comes to the protocol’s security. They leverage economic incentives to maintain the network’s functioning and accountability. If a single dishonest Collection or Execution Node introduces incorrect data, any other role can punish them and trigger recovery from that invalid data.

The Execution and Collection nodes have crucial roles as they optimize the security and scalability of the network. These nodes can also be verified by other roles.

All validators participate in the validation of every transaction in the network, but they do so at their respective stage. This allows validators to specialize for their specific roles in the protocol, thus highly increasing efficiency.

The separation of jobs goes across different validation stages for each transaction, rather than relying on sharding to enhance scalability. The problems with fragmenting a blockchain into interconnected networks is that serializability guarantees are lost, which makes transactions more difficult.

Most users can not validate blocks in all the shards. Whenever they need to interact with a particular shard, they can not verify the entire history of it. By splitting the tasks of a validator into different roles, the Flow protocol scales to higher throughput, low cost, as well as maintains a community where all participants have an essential role to make the system work efficiently.

Besides, the programmability layer at the Flow protocol allows smart contracts and users to interact with each other in a single transaction. Developers can share their work with other developers.

Resource-Oriented Programming

Flow uses Cadence, a resource-oriented programming language with an easy-to-read ergonomic syntax and a type system that minimizes runtime errors. It is designed to support all interfaces, methods, and transactions to include pre- and postconditions, enforcing expected behavior. The Flow protocol has Flow Playground for developers keen to know about Cadence and how to start building applications on it.

This new parading is designed to be secure and easy to use for most developers, as Cadence tracks the ownership of every application that developers make.

There are other tools in the network that users can get their hands on, such as the Flow Go SDK. This tool allows developers to work on backend integration with high scalability. It has become one of the most popular backend programming languages due to its high performance.

The protocol also introduces the Flow JavaScript SDK, designed especially for frontend developers who want to integrate and interact with Flow. Developers can easily create dApps without application binary interface (ABI) and use them for their businesses.

In addition, the protocol is suitable for all developers seeking to build valuable products for the community. Developers can upgrade smart contracts and use Flow Emulator to provide development experience. It has proven to be friendly for mainstream consumers with payments on-ramps using other tokens besides FLOW and fiat as well.

Flow Token

Flow (FLOW) token is the native Flow’s currency and the principal reserve asset of the network. Developers, validators, and users who participate in the network use the FLOW token to earn rewards, to decide on future changes in the protocol and its governance.

The protocol self-distributes inflation of FLOW tokens without dilution to all token holders and does not need any transactions. Inflation happens daily and does not depend on users’ actions. Inflation allows the application of the token into modern DeFi use cases without diluting holders.

Flow also applies the single-responsibility principle (SRP) from software engineering. In other words, the protocol takes responsibility for the essential distribution functions and allows the Ethereum network to manage everything outside from that.

Notably, the FLOW inflation is commanded by so-called “Eras”. The first one is Genesis that lasts 60 days and is followed by 10 additional Eras, each lasting 365 days.

The daily inflation for the token supply starts at 1% during the Genesis Era and is halved at the end of every Era.

The supply becomes capped when inflation stops, after the completion of the final Era.

The token supply started at 10,000,000 FLOW and will increase to 700,000,000 as the daily inflation occurs over a period of 10 years.

Flow’s Advantages over other Blockchains

Dapper Labs designed Flow to support several consumer applications with the necessary throughput to scale to millions of active users. The protocol provides several technical innovations. They are as follows:

  • Pipelined architecture with multiple validator roles to enhance performance, security, and scalability.
  • Single shared state for all smart contracts, with transactions having full ACID (serializability) without the need to shard the system.
  • Set of tools to provide developers with the best experience and expertise to build applications on the protocol.

Conclusion

Flow is powering a whole community with a space where everyone has an important role to sustain the protocol. Developers, companies, and ambassadors can join the network to build applications for their consumers. With its scalability, security, and effectiveness, Flow is establishing a sustainable ecosystem for DeFi products for the mainstream adoption.

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FAQ

What is Flow?

Flow is a decentralized protocol with a unique multi-chain infrastructure where users can build crypto applications using a handful of features and tools that enhance usability, speed, and scalability. Flow’s blockchain is an Ethereum-based network designed to support internet-scale protocols and apps in order to ensure a user-friendly experience. The protocol has its own FLOW token used by validators, developers, and users to participate in the platform’s governance and earn rewards.

Who is standing behind Flow?

Dapper Labs developed Flow blockchain back in 2018. The company uses blockchain technology to experiment and bring new features for the crypto-community and the DeFi space. Its team includes former founder of Axiom Zen Roham Gharegozlou, CryptoKitties co-founder Dieter “dete” Shirley, Fuel founder Mikhael Naayem, as well as other tech experts.

Since the launch of Flow, Dapper Labs has been working to connect fans all around the world and give consumers the opportunity to become creators. Some of the partners of Dapper Labs include the NBA, Warner Music Group, and the UFC.

How does Flow work?

Flow applies pipelining – a common technique that considerably scales up productivity by dividing the work of a validator into four roles:

  1. Collection. Collection nodes improve network connectivity and data availability for applications built on the protocol.
  2. Consensus. The consensus nodes are in charge of deciding on the presence and order of all transactions on the blockchain.
  3. Execution. These nodes are required to perform all the computation associated with every transaction.
  4. Verification. Verification nodes keep the Execution Nodes in check. 

All validators participate in the validation of every transaction in the network, but they do so at their respective stage. This allows validators to specialize for their specific roles in the protocol and thus highly increase efficiency.

How is Flow different from other blockchains?

Dapper Labs designed Flow to support several consumer applications with the necessary throughput to scale to millions of active users. The protocol provides several technical innovations. They are as follows: 

  • Pipelined architecture with multiple validator roles to enhance performance, security, and scalability.
  • Single shared state for all smart contracts, with transactions having full ACID (serializability) without the need to shard the system.
  • Set of tools to provide developers with the best experience and expertise to build applications on the protocol.

How is Flow governed?

The community governs the protocol by holding FLOW – the platform’s native token. Developers, validators, and users who participate in the network use the FLOW token to earn rewards, to decide on future changes in the protocol, and its governance.

What is Flow token?

The Flow token is the native currency and the principal reserve asset of the Flow network.

What are the pros and cons of Flow?

The main advantages of Flow are multi-role infrastructure designed to serve billions of users globally, unique design that allows a greater scalability without collapsing the network, as well as dividing of the roles of all validators so they specialized in a single stage of the transaction.

As far as the cons are considered, Flow is not fully decentralized, as the inflation process and the token are handled by the protocol.

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