In this article, we will learn about the FLOW token and the blockchain network associated with it. Here you will find everything you need to know about FLOW, how it works, and how to invest in it. We will also cover some key events that have occurred in the history of FLOW.
What is FLOW?
FLOW is a blockchain platform originally designed for gaming purposes, but it has expanded since its launch in 2020. The FLOW blockchain enables fast transactions at a low cost and supports smart contracts. FLOW supports blockchain applications including NBA Top Shot, which is a showcase for non-fungible tokens (NFTs). FLOW also has a native digital currency that trades under the symbol FLOW.
Special Features of FLOW
The FLOW blockchain is designed to support gaming and consumer applications and can potentially handle transactions from millions of active users. Gaming, collectibles, and related applications can be supported by the FLOW blockchain.
By supporting interaction between smart contracts, the FLOW blockchain is enabled for a large number of applications on its platform, just like the Ethereum blockchain.
FLOW also claims to be more efficient than other blockchains because the task performed by each miner – the computers that verify transactions and maintain blockchain records – is divided across five nodes. According to FLOW, this division reduces the redundancy in the work done by each node and results in increased processing speed.
How to Mine FLOW
The FLOW blockchain uses a modified version of proof-of-stake consensus mechanism, meaning that the digital transfers of cryptocurrency are verified rather than mined. The FLOW network consists of nodes that perform specialized tasks. The FLOW blockchain divides the tasks that a single miner would typically do among multiple participants in the network.
To process digital transfers of cryptocurrency and add new blocks to the blockchain, FLOW relies on four types of nodes:
- Consensus Nodes: These nodes determine the existence and order of transactions on the FLOW blockchain.
- Execution Nodes: They perform the calculations required to complete and verify transfers on FLOW.
- Validation Nodes: The activities of execution nodes are monitored and verified by validation nodes.
- Aggregation Nodes: Aggregation nodes exist to enhance connectivity and data availability across the FLOW blockchain.
The FLOW blockchain also uses another cryptographic technology called Specialized Proofs of Confidential Knowledge (SPoCKs) to ensure that execution and validation nodes perform their functions correctly. SPoCK is unique information for each node and cannot be forged. Using this information, nodes must demonstrate their work or how they completed their task in order to receive their reward. This helps prevent execution nodes from copying others’ work and validation nodes from accepting results without verification.
How to Invest in FLOW
If you want to add FLOW to your cryptocurrency portfolio, you can buy it through a cryptocurrency exchange. You will also need a compatible cryptocurrency wallet.
Once you have created a compatible wallet, you can follow these steps to purchase the cryptocurrency:
- Choose a cryptocurrency exchange: Token trading is supported by Kraken, KuCoin, and others. You can choose the exchange that suits you best.
- Fund your digital wallet: Whether your digital wallet is hosted by a cryptocurrency exchange or self-custodial, the next step is to fund the account using another currency. You can deposit fiat currency like US dollars or convert cryptocurrency like Bitcoin or Ethereum.
- Place a buy order: Through the user interface of the cryptocurrency exchange, search for “FLOW” to buy the digital currency. Enter the required information to set up your order, then click the “buy” button.
Make sure
Always double-check transaction details before making any cryptocurrency purchases, as they are virtually impossible to reverse.
Transaction Times
Flow claims to ensure rapid block verification on the blockchain by distributing the workload among the nodes. At launch in 2020, Flow stated it was processing 10 blocks in 10 seconds, which means one block per second. Processing a block on the Bitcoin blockchain takes about 10 minutes on average, and 12-14 seconds on the Ethereum network.
According to Kraken, it takes 30 confirmations and about one minute to complete a FLOW cryptocurrency transfer on the platform. This is much faster compared to the transaction time for Ether, which takes five minutes.
Fees and Expenses
On April 29, 2022, Flow network participants voted to implement a new fee structure. This new structure will mean different fees for different types of transactions on the network, based on the effort required to complete them, rather than a fixed fee of 0.00001 FLOW per transaction as had previously existed.
Notable Events
Flow’s blockchain network is only two years old, but several exciting developments have occurred in its short life. Here are some notable events:
- September 2019: Dapper Labs announced the creation of the Flow network.
- May 2020: The Flow network went live.
- June 2020: NBA Top Shot was launched as the first application supported by the Flow network.
- April 2022: The Flow network voted to implement a new variable fee structure.
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Source: https://www.thebalancemoney.com/flow-explained-5323569
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