Fantom cuts staking requirement by 90% in a bid to increase security

The Fantom Foundation has confirmed it has cut the validator self-staking requirement on its layer-1 blockchain Fantom by 90%, more than six months after passing a governance vote. 

In a Jan. 15 post on X, Fantom Foundation said the changes were made “recently,” following the vote, which concluded in June 2023. The changes see Fantom (FTM) staking threshold cut from 500,000 FTM to 50,000 FTM, currently worth $19,500.

The foundation said the change will strengthen Fantom’s security while making it “more accessible than ever” to run a validator.

“By having more validators, a network makes it increasingly challenging for malicious actors to launch an attack,” the foundation said on Jan. 15.

Fantom validators operate by bundling up transactions and sharing them with other validators. Finality occurs when at least two-thirds of network validators reach a consensus.

The foundation noted that a validator increase would result in submitted transactions reaching validators faster as there would be more to choose from.

But the foundation also preempted a potential concern by stating that the uptick in validator count will not slow down the Fantom network:

As long as new validators are running on quality hardware, the network will be more secure and won't see any downgrade in performance as it maintains the 1–2 second time to finality.

Fantom alo stressed that lower staking requirements wouldn’t pose a security risk because a validator’s power to confirm transactions is proportional to its staking amount, not the number of validators it runs.

“A validator with 1 million FTM staked would have the same power as twenty smaller validators, each with 50k FTM staked,” Fantom explained.

Fantom had been proposing to lower the minimum amount of FTM to run a node since at least February 2022.

Data shows that Fantom currently has 58 validators securing its network, according to Fantom’s block explorer.

By contrast, Ethereum, the largest layer 1 smart contract platform, has over 1.1 million validators, while Cardano, Solana and Avalanche hosted 2,589, 1,876 and 1,119 validators at the time of a June 2023 report citing Messari data.

Three months ago, the Fantom Foundation’s official hot wallet was hacked for $550,000, which the firm said accounted for less than 1% of the foundation’s funds.

Fantom Foundation awarded $1.7 million to a security researcher who identified an additional potential risk associated with the hack and promptly alerted the foundation. The blockchain firm said they helped mitigate what could have been $170 million in potential damage.