Let's talk Web3: Flow Blockchain Review
As the crypto and web 3 scene continues to expand, the grading of each new product is still unknown. This means that for the average person, we’re more so pushed toward the most popular products in the market right now. Whether it’s an application or protocol, this entire space continues to develop and we have the opportunity to define the new landscape.
This series aims to dive into the most popular crypto & web 3 products to:
Break down the ‘why’ behind its popularity
Uncover the benefits & challenges
Question the design
Introduce the competitors
Gauge developer’s sentiment
Provide recommendations for future development
This is our opportunity to set the bar, so join me through this article as we tackle the Flow Blockchain.
What is it?
Flow is a layer one blockchain created to adopt an improved approach to entertainment-driven crypto assets specifically Non-Fungible Tokens (NFTs). It aims to improve scalability, transaction costs, and model development (smart contracts) beyond the traditional capabilities offered by Ethereum.
The blockchain is targeted towards developers to leverage in their projects as it improves performance due to its multi-node architecture ensuring security and composability.
In simplest terms, it provides the backend infrastructure behind the NFTs and ensures proper support for projects to be built on top of a reliable blockchain. Its traction over recent years consists of notable projects with NBA, UFC, and many more.
Web 2 Product Review
Daily transactions between 200K to 500K (average), large partnerships, secure and scalable blockchain, very high potential
Upgradeable smart contracts, speed/finality, log management
Web 3 Product Review - Similar to a typical product review, but with additional factors to consider.
Node operators, large partnerships
Consensus & Verification nodes, Specialized Proofs of Confidential Knowledge (SPoCKs), limiting lost access to assets & accounts
🚀 Debunking the Popularity
Here's a quick history lesson from my deep dive:
Dapper Labs, a whale in the Crypto space is the company behind CrytoKitties. Though I didn't hear about CrytoKitties till early 2020, I soon realized that it was an OG in the NFT space that created the ripple effect to what we have going on today. Originally with the creation of CryptoKitties, there were a series of problems that were created but outlined the various flaws in the Ethereum Network at the time. This consisted of the extremely high costs for developers and the same was repeated for the consumers dealing with outrageously high gas prices.
It's often said that the best solutions are created when looking to solve a problem you're facing. This was exactly what Dapper aimed to solve by creating the Flow Blockchain. It was created to make entertainment assets faster, more scalable, and much more cost-efficient. Since its creation in 2019, it has continued to scale in newer and bigger projects every quarter. Currently, it’s averaging between 200,000 to 500,000 transactions daily with spikes of up to 1 million transactions.
Beyond the offerings of the technology, the Flow blockchain has also seen tremendous popularity from its incredible partnerships consisting of large corporations including NBA, UFC, NFL, Barbie, Balmain, and many more. As the underlying technology behind these projects, the Flow blockchain has been able to see itself continuously grow month-over-month as NFTs also gained immense adoption.
As supporters or collectors of these brands, you’re immediately drawn to the NFTs and these partnerships generally provided great value to the holders. A prime example is NBA Top Shot - an NFT collection that stores specific clips from the NBA season of specific players or teams. Though the collection's popularity died down since it/high last year, it saw peeks of over $200 million in sales and $53.8 million in January 2022 alone. It was the first blockchain-based product to reach over 1 million consumers consisting of $80 million in direct sales and over $750 million in secondary marketplace sales.
🧑💻 User Experience & User Interface
The primary ‘improvement’ that this blockchain offers is the introduction of Cadence. Although Solidity is referred to as the go-to blockchain language, it was recognized that there are clear improvements that can be made to the programming model that would define the ‘new paradigm of crypto-enabled applications’. Leveraging the Resource-Oriented Programming approach that follows a new ownership model inspired by Linear Types for smart contract development, Cadence was created by Flow specifically for smart contract development.
At the core of this language, its specific offerings include increased decentralization, more security, and friendliness to users. With ergonomic syntax, it's also a very comfortable language to understand. Another vital component to getting started is the Flow Playground - an online development environment. This beginner-friendly platform requires no installation and can immediately provide an introduction to get your hands dirty with Cadence.
Beyond the traditional development that we may be familiar with, there are a few additional features that make Flow much more attractive in the eyes of developers. Whether this includes direct changes to their developer experience or the user experience, these features play a significant role in shaping this blockchain.
Upgradeable Smart Contracts in “Beta State” - Though the benefits of smart contract development are the immutability that exists, this can also exist as a disadvantage. Therefore, Flow offers smart contracts to be changed in the beta state where developers can continuously upgrade the contracts before finally ‘uploading’ to the blockchain.
Speed/finality of the blockchain or - With the intent to target applications, gaming, and entertainment, the speed of transactions is a vital component of this blockchain. This measure is determined by the “time it takes before the transaction is permanently included in the chain” also referred to as finality. For bitcoin, it can often take an hour for 6 block transactions and 6 minutes for Ethereum. In the case of Flow, it can take seconds as it will simply be verified by the Consensus Nodes and transmitted to users immediately (or a few seconds depending on the reliance of other transactions on the network).
Log management - An improved approach to manage smart contract transactions that provide the developer with the capability to query a subset of transactions and run locally - avoiding an influx of data.
The community’s participation includes the developers, contributors, and consumers. By diving deeper, we’ll find the following critical factors offered by Flow to enhance its community engagement:
Node Operators - By supporting the blockchain as a validator of nodes, the operator will be able to receive a portion of the transaction costs and the ‘associated stake’. The incentive driving users to become a validator is the accessibility to get started with cheap hardware versus alternative blockchains.
Partnerships - A strong competitive advantage of Flow & Dapper Labs is the ecosystem with its partners. From large sports organizations to fashion icons, the communities being built under these various projects are users passionate about NFTs/gaming but also users being onboarded into this space for the first time via partnerships.
🛠 Developer’s Corner
From the get-go, Flow emphasizes being a developer-centric and NFT platform targeting the entertainment industry, NFTs, and DAOs. Here are the top features to cover from the technical side:
Multi-Node Architecture: In many blockchain projects, scalability is tough and often sacrificed by reverting to Sharding. Sharding refers to processing data in small sections/splitting it up versus the entire database as a whole. Often this can cause troubles with scaling since it becomes too much for nodes to process at the same time.
This is where Flow decided to take a different approach. It was recognized that sharding creates problems for developers for composability/building on top of the blockchain. So the alternative was the multi-node approach. This meant to dedicate each node to a specific task rather than overload the nodes - splitting them into Consensus, Verification, Execution, and Collection nodes.
Smart Contract Costs: As pricing is an important factor to be considered, Flow has two simple costs:
1) account creation fee starting at 0.001 FLOW (less than 5 cents)
2) the transaction fee starts at 0.000001 FLOW.
As a developer, this is music to the ears. This blockchain provides incredible support to developers to continuously deploy contracts or iterate without taking on the burden of heavy costs. As mentioned above, the blockchain was created with the intent to target NFTs, gaming, and entertainment hence indicating the low costs.
As an open-source developer-centric blockchain, there are three main features that are included in the tool kit.
Taking the developer experience further, the Flow team aims to build out an advanced support system surrounding their ecosystem consisting of the Developer Alpha Program for creating a pipeline for feedback from the community of developers and enhancing the developer ecosystem by rewarding developers with tokens for their contributions.
For any blockchain, security receives the utmost priority and it comes with no surprise that Flow places an emphasis on ensuring that its processes align with this objective. How? Right from the foundation of its multi-role architecture specifically the consensus and verification nodes.
These two specific nodes primarily focus on the order of the transactions and ensuring the correct status of other nodes. Of course, concurrently you’ll also have these nodes validating the security of the blockchain through crypto-economic incentives. Throughout the blockchain, they will have an active role and participation to ensure that each node is held accountable for any input of invalid data which immediately kicks off the recovery process.
In the meanwhile, the execution and collection nodes can focus on the processing of each node and network enhancement with emphasis on scalability. Taking a closer look, we’ll also find an additional layer of cryptographic security used called Specialized Proofs of Confidential Knowledge (SPoCKs). In short, this provides more transparency in the process by leveraging a third-party observer.
Shifting the perspective over to the users, there are additional functionalities that exist in the development process to ensure that assets or access to the account are never lost and also additional authentication support. These added layers of customer support and security, both speak towards the attention that’s provided to the user experience.
📰 Recommendations & News
Partnerships and Credentials - The solutions offered by Flow are vital in understanding the improvements that they provide when it comes to the scalability of projects, low tractions costs, and improved experiences of consumers. This would mean that there needs to be improved familiarity with the community of developers emphasizing its benefits. How about credentials for those developers learning about the blockchain and creating Flow leaders?
Beyond the large partnerships, it is also important to expand the product strategy offerings to smaller projects for expansion. Currently, the popularity rests on the Ethereum blockchain and the unfamiliarity amongst developers stops the growth. Partnerships with platforms like Buildspace and Thirdweb would be very beneficial!
Expand Community - This improved approach of network scalability while maintaining decentralization of consensus is an advanced and cleaver approach to the blockchain. So, it is even more important to ensure that the beginner developers understand the behind-the-scenes as well!
This means that there are opportunities within the website/platform to learn the fundamentals that lead to advanced topics. This will allow for new developers to be easily onboarded despite having a lack of experience in development.
Please note that this analysis would not be possible without the comprehensive documentation provided by Flow. Have a read through their primer.