Blockchain and Flow Cryptocurrency: An Overview of the L1 Platform for NFT and GameFi

the editorial office
3 January 2023

Flow is a blockchain platform designed to enable NFTs and implement gaming applications. The project provides the opportunity to create dapps, digital collectibles and meta-universes.

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The flow architecture is based on the principle of separation of tasks: each node fulfills its own function. This principle enables an increase in network performance by a whole order of magnitude. Support for the Cadence programming language for writing smart contracts facilitates the issuance of non-fungible tokens (NFTs).

The creator of the platform is Dapper Labs, the creators of the first popular blockchain game CryptoKitties. An ecosystem has been built on top of the Flow blockchain, supported by leading esports governing bodies including the NBA, UFC and NFL. Meta has integrated the NFTs issued by Flow into Instagram and Facebook.

What problem does Flow solve?

Many projects release NFTs on the Ethereum network, but transaction costs exceed several tens of thousands of dollars during peak periods. Blockchain Flow solves the problem of scalability and high fees without sharding.

Flow blockchain is designed for NFT, gaming projects and other applications. It is ideal for users who are not familiar with blockchain technology: the addresses in the network are short and the participants do not need private keys.

The platform is geared to run large, decentralized applications leveraging NFT – mainly GameFi projects.

Flow has its own cryptocurrency trading under the ticker FLOW, as well as an official wallet for its storage – Dapper Wallet. Dapper Labs runs its own projects on the platform, but the Flow protocol is open to developers and third-party companies.

Specifically at flow blockchain

Flow uses a special architecture that enables high performance without network fragmentation (sharding).

Groups of nodes are responsible for different functions. Flow uses four types of nodes:

  1. Collection of nodes process and “wrap” transactions. They only send hashes to the validators and fill in information about the transfers to the other nodes.
  2. Consensus nodes (validators) generate preliminary versions of blocks using the proof-of-stake algorithm and solve subjective problems through voting. This type of node only processes transaction hashes and performs no other calculations.
  3. Execution nodes process transactions and smart contracts. They determine the state of the network and then create the final version of the blocks. In addition, these nodes perform objective calculations that have only a single solution. They request data from collector nodes to process transactions.
  4. The verification nodes selectively verify the transactions. Operating this type of hub avoids a conflict of interest. The latter occurs when the consensus nodes confirm the blocks they form. The algorithm also excludes verification nodes that are not working or overloading the network.

This approach makes better use of resources and increases blockchain throughput by more than 50x compared to peers, the authors of the Flow white paper claim.

Flow allows for running smart contracts. The environment allows for application testing, logging and a network emulator. The platform uses the Cadence programming language, which simplifies the creation of NFTs.

Flow’s management system and ecosystem development

In the fall of 2021, Flow integrated a decentralized cloud file storage solution from the blockchain platform Filecoin. At the same time, Dapper Labs entered into a long-term collaboration agreement with Google Cloud to help scale Flow.

One of Dapper Labs’ acquisitions is the startup Brud, whose solutions aim to expand the Flow ecosystem with tools to quickly create decentralized autonomous organizations (DAOs). Flow has created a bounty program for this area. The offers are now accepted and implemented off-chain.

Not only sports organizations are aware of flow: in the summer of 2022, Meta announced the upcoming integration of blockchain in Instagram. Different cryptocurrencies are gradually becoming more and more a part of our daily life, and in order to stay in the trend and constantly change your crypto portfolio in a timely manner, one must not forget about modern technology and its usefulness in constantly monitoring the crypto market. There are already various applications with cryptobots such as Bitcoin quick profitwho can follow market trends 24/7 and make logical decisions based solely on facts and data.

In 2020, Dapper Labs announced plans to migrate CryptoKitties from Ethereum to Flow. This will enable new game features and use of tokens in other applications. However, the exact timetable for the transition is not yet known.

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