Flow (blockchain)

Flow is a decentralized blockchain designed as a foundation for games, apps, and the digital assets that power them. The layer-one blockchain was created by the team behind CryptoKitties, Dapper Wallet, and NBA Top Shot.

Flow's ecosystem comprises entertainment brands, development studios, and venture-backed start-ups. Some partners include global IP brands, such as Warner Music, Ubisoft, NBA, and UFC; game developers, like Animoca Brands, Sumo Digital, and nWay; crypto developers, like Circle and Binance; and start-ups, like Opensea.

Some of the steps the Flow team will be implementing in the ecosystem include the Developer Alpha Program and ecosystem development. In the Developer Alpha Program, the Flow team will demonstrate the capabilities of the network to interested blockchain developers to get technical feedback. Both independent hobbyists and venture-backed organizations will be involved.

A portion of Flow tokens is set aside for ecosystem development to increase adoption and incentivize early participants in the network. The participation rewards will be shared through varying programs like competitions, hackathons, and contributions to open-source development. Setting aside a portion of the tokens for long-term ecosystem development also enables a path to diversifying and decentralizing participation and governance, enabling global access from different participants.

Validator node operators supporting Flow get a portion of the transaction fees that go through the system; what they receive is proportional to the amount of work they do and their associated stake. Flow Validators can begin as consensus or verification nodes with hardware, enabling broad participation and decentralization.

In the early beginnings of Flow, when fees are low, Flow offers extra incentives to node operators proportional to their effort and associated stake. The smart contracts on Flow are able to be assembled like Lego blocks in order to power apps serving different people, from basketball fans to businesses. There are four pillars of Flow:

• Multi-role architecture: Flow’s design allows the network to scale to serve users without sharding or minimizing decentralization of consensus.
• Resource-oriented programming: The smart contracts on Flow are written in Cadence, a programming language for crypto assets and apps.
• Developer ergonomics: The network includes upgradeable smart contracts and built-in logging support for the Flow Emulator.
• Consumer onboarding: The network was designed for mainstream consumers, with payment onramps catalyzing a path from fiat to crypto.

FLOW is the native currency for apps, games, and smart contracts that are built on top of the Flow blockchain. It is the currency available for developers and users to transact with on the network. Developers are able to build FLOW directly into their apps for peer-to-peer payments, including charging for services or allowing consumers to get rewards. It can be held, transferred, and also transacted by users peer-to-peer. It is designed as a payment method, including a long-term reserve asset for the Flow economy.

The token is utilized by validators, developers, and users who want to participate in the FLOW network and receive rewards. Flow is also utilized for fees and for participating in protocol governance. Buyers pay with other currencies, and sellers price and receive in the currency they require. Flow allows developers to implement decentralized exchanges (DEXs) that serve as a clearing house between tokens. It can utilize frequent batch auctions to overcome front-running attacks on these DEXs.

Flow was initially provided to the public in October 2020 via CoinList but was unavailable in the United States and Canada. The tokens that were sold via the offering were locked up for a year and could not be circulated until they were unlocked. FLOW incentives paid to validators can be transferred and sold, which means there is some FLOW out on the market, and some exchanges—such as Kraken and Huobi—allow users to transact FLOW.

Flow is also building out its infrastructure. In June 2021, Dapper Labs launched FUSD, a stablecoin on Flow. The stablecoin is backed one-for-one by US dollars that are deposited at the financial infrastructure provider called Prime Trust. This is a part of Dapper Labs' plans for Flow and envisages it being utilized for elaborate game experiences beyond NFTs.

Token holders can get rewards by staking their FLOW as a security deposit and working to secure the network via the operation of validator nodes—or delegating their stake to other operators to operate validator nodes on their behalf. Validator nodes get staking rewards and transaction fees in exchange for offering the security, computation, and storage services that Flow requires. The FLOW token is also required for different activities on the network, like user accounts, storage for assets, and smart contracts.

As the network grows, FLOW token holders can use their FLOW in different ways:

• Payment for computation and validation services (i.e., transaction fees)
• Medium of exchange
• Deposit for data storage
• Collateral for secondary tokens
• Participation in governance