- Fantom disclosed that Ethereum would enable the token migration.
- While FTM’s price increased, reaching $1 could be challenging in the short term.
Layer-1 blockchain Fantom [FTM] has disclosed a new set of important details as it approaches the final stages before the Sonic upgrade launch.
For those unfamiliar, Sonic upgrade is the next iteration of Fantom that the project claims would boost the number of Transactions Per Second (TPS) to 2000.
However, besides improved performance, the recent upgrade mentioned Ethereum [ETH] as a major player in the development.
Ethereum to aid the switch
According to the memo directed at FTM holders, the project would launch a new layer-1 and layer-2 chain. For both chains, the project said that holders of the token would be able to bridge assets to Ethereum.
It explained,
“The Sonic chain will be a layer-1 platform that connects to Ethereum via a bespoke layer-2 bridge, allowing Sonic to tap into vast amounts of liquidity, users, and protocols. This allows the network to combine the low cost, scalability, and speed of a layer-1 with the security of a layer-2 bridge for access to native ETH and other assets on Ethereum.”
Previously, Fantom had mentioned that it planned to launch a token for the launch with the ticker “S” for Sonic. As such, FTM holders can migrate their tokens to S at a 1:1 ratio using Ethereum.
At press time, FTM’s price was $0.86— A 6.22% increase in the last 24 hours. The price increase could be linked to the rising optimism geared toward the upgrade and token introduction.
Furthermore, AMBCrypto noticed that the 24-hour active addresses on the Fantom jumped on the 17th of May. The increase implied that the rate of successful transactions on the network jumped.
Source: Santiment
However, the metric, at press time, had decreased, implying that the increase lasted only for a short period. Likewise, on-chain data showed that the one-day circulation fell.
Network activity struggles to hold up
As of this writing, FTM circulation was 2.97 million, confirming the notion that tokens engaged in transactions had reduced.
If these metrics continue to fall, it could be difficult for FTM’s price to approach $1.
But that does not imply that the value would not increase. At the same, a significant plunge could be off the option. In addition, we looked at the Total Value Locked (TVL).
According to DeFiLlama, Fantom’s TVL was $133.38 million. This was a significant increase in the last 30 days. The increase indicated an improvement in the health of protocols operating under the chain.
Source: DeFiLlama
Realistic or not, here’s FTM’s market cap in ETH terms
However, this value remains a low one compared to 2022 when the metric hit an incredible $7 billion. As it stands, it could be difficult for Fantom to experience that level of locked assets again.
But when it launches the Sonic upgrade, trust might return to the chain, it could experience a notable influx of assets deposited.