Sonic mainnet goes online: Can performance narrative, currency exchange, and airdrops restore Fantom to its peak state?

Author: Frank, PANews

From the former star public chain Fantom to today's Sonic Labs, 2024 can be described as a drastic year on this Layer 1 chain: the foundation is renamed, the main network is upgraded, and tokens are exchanged. Fantom tried to complete the "second entrepreneurship" with a series of actions. However, from the fall of TVL to less than 100 million US dollars, the continuous controversy over additional issuance, and the shadow of cross-chain security that has not yet dissipated, Sonic still faces many doubts and challenges. Can the high performance of the new chain be realized? Can currency swaps and airdrops save the ecosystem?

Tell performance stories and return to the market with sub-second public

chains

On December 18, 2024, the Fantom Foundation officially changed its name to Sonic Labs and announced the launch of the Sonic mainnet. As a new public chain known for its sub-second transaction speed, performance has naturally become Fantom’s most important technical narrative. On December 21, just three days after going online, official data showed that 1 million blocks had been produced on the Sonic chain.

So what’s the secret to being “fast”? According to the official introduction, Sonic has deeply optimized both the consensus layer and the storage layer, and introduced technical means such as live-pruning, node synchronization acceleration, and database weight loss, so that nodes can confirm and record transactions with a lighter burden. . Officials claim that compared with the old Opera chain, the node synchronization speed is increased by 10 times, and the cost of large-scale RPC nodes can be reduced by 96%, laying the foundation for a truly high-performance network.

It is worth noting that although "high TPS" is not new in public chain competition, it is still one of the core indicators that attracts users and project parties. A fast and smooth interactive experience can usually lower the user's threshold for blockchain, and also provide possibilities for application scenarios such as complex contracts, high-frequency transactions, and metaverse games.

In addition to "high performance", Sonic stated that it fully supports EVM and is compatible with mainstream smart contract languages ​​such as Solidity and Vyper. On the surface, "self-developed virtual machine vs. compatible with EVM" was once a watershed for new public chains. However, Sonic chose the latter. The advantage of this is that the migration threshold for developers is low, as long as they are originally in Ethereum or other EVM Smart contracts written on the chain can be directly deployed to Sonic without major changes, saving a lot of adaptation costs.

Facing the fiercely competitive public chain market, giving up EVM often means re-cultivating developers and users. Obviously, Sonic hopes to "smoothly" inherit the Ethereum ecosystem on the basis of strong performance and get the project off the ground as quickly as possible. Judging from the official Q&A, the Sonic team has also considered other routes, but based on the judgment of industry inertia, EVM is still the most "greatest common denominator" choice, which will help quickly accumulate the number of applications and user base in the early stage.

In addition, Fantom once suffered a setback due to cross-chain in the Multichain incident. Therefore, Sonic's cross-chain strategy has also attracted much attention. The official technical document lists the cross-chain Sonic Gateway as a key technology and specifically introduces it. safety mechanism. Sonic Gateway uses the method of validators running clients on both sides of Sonic and Ethereum, and has decentralized and non-tamperable "Fail-Safe" protection. The design of the "Fail-Safe" mechanism is relatively special: if the bridge does not report a "heartbeat" for 14 days, the original assets can be automatically unlocked on the Ethereum side to protect user funds; the default is every 10 minutes (ETH→Sonic), 1 hour (Sonic →ETH) for packaging cross-chain, and can also be triggered instantly for a fee; Sonic's own validator network operates the gateway by running clients on Sonic and Ethereum. This ensures that Sonic Gateway is as decentralized as the Sonic chain itself, eliminating the risk of centralized manipulation.

From a design point of view, Sonic's main update hopes to attract a new round of developers and funds through "hardware configurations" such as 10,000-level TPS, sub-second settlement, and EVM compatibility, so that this old public chain will be reborn with a new image and performance. Back to market perspective.

Token Economics: Issuance on the left hand, destruction on the right hand

In fact, the most discussed topic in the community currently is Sonic’s new token economics. On the one hand, the 1:1 exchange model for FTM looks equivalent to translation. On the other hand, the airdrop plan after 6 months is equivalent to the issuance of an additional 6% of tokens (approximately 190 million tokens), which is also considered by the community to dilute the value of tokens.

When Sonic first went online, it set the same initial supply (total supply) of 3.175 billion as FTM, ensuring that old currency holders can obtain S at a 1:1 ratio. However, if you study carefully, you will find that additional issuance may only be a part of Sonic, and token economics also contains many approaches to total balance.

Official documents show that starting six months after the mainnet goes online, an additional 1.5% (approximately 47.625 million S) will be issued every year for six years for network operations, marketing, DeFi promotion and other purposes. But if these tokens are not used up in a certain year, they will be 100% destroyed, ensuring that only the additional issuance is actually put into construction instead of being stored in the foundation.

In the first four years, the 3.5% annualized validator reward on the Sonic mainnet was mainly derived from Opera’s unused FTM “block reward share”, thus avoiding hyperinflation caused by large amounts of new S being minted in the early stages of launch. Four years later, the issuance of new tokens will resume at a rate of 1.75% to pay block rewards.

In order to hedge against the inflationary pressure caused by this additional issuance, Sonic has designed three destruction mechanisms:

Fee Monetization Burn: If the DApp does not participate in FeeM, users will directly burn 50% of the Gas fee in the transactions generated by the application; it is equivalent to levying a higher "deflation tax" on applications that "do not participate in cooperation sharing", encouraging DApp Take the initiative to participate in FeeM.

Airdrop Burn : 75% of the airdrop shares require a vesting period of 270 days to fully obtain them; if the user chooses to unlock them in advance, they will lose part of the airdrop shares, and these "deducted" shares will be directly destroyed, thus reducing the circulation of S in the market.

Ongoing Funding Burn: 1.5% of the annual additional issuance used for network development. If it is not used up in the year, 100% of the remaining tokens will be burned; this can avoid the hoarding of tokens by the foundation and also limit the long-term squeeze of tokens by some members. .

Overall, Sonic is trying to ensure ecological development funds through "controllable issuance" on one hand and "destruction" on the other hand to curb inflation. The most noteworthy one is the "burning" under the FeeM mechanism, because it is directly linked to the degree of participation and transaction volume of DApps, which means that the more applications do not participate in FeeM, the greater the deflation on the chain; conversely, the more FeeM applications , the "deflation tax" decreases, but developer sharing will increase, forming a dynamic balance between profit sharing and deflation.

TVL is only 1% of its peak. Can money rebates + airdrops regain the

momentum of DeFi?

The Fantom team used to be prosperous in the bull market from 2021 to 2022, but Fantom’s on-chain performance in the past year has not been ideal. Fantom’s current TVL is only about US$90 million, ranking 49th in the DeFi public chain. At its peak, Fantom Its TVL value was once as high as about US$7 billion. The current data is only about 1% of the peak.

Perhaps in order to revitalize the DeFi ecosystem, Sonic has launched a Fee Monetization (FeeM) mechanism, claiming that it can return up to 90% of network gas fees to project parties, allowing them to rely on actual use on the chain without overly relying on external financing. Achieve sustained returns. This model draws on the Web2 platform’s “sharing by traffic” approach, hoping to encourage more DeFi, NFT, GameFi and other developers to come to Sonic and stay.

In addition, the official has set up an airdrop pool of 200 million S tokens, and launched two ways to play: Sonic Points, which encourages ordinary users to actively interact and hold on Sonic or accumulate certain historical activities on Opera; Sonic Gems, which is for developers Incentives to encourage them to launch attractive DApps with real usage on the Sonic chain. This part of S used for airdrops also incorporates mechanisms such as "linear attribution + NFT locking + early unlocking and destruction", trying to find a balance between airdrops and mid- to long-term stickiness.

Mainnet online, 1 million block milestone, cross-chain Bridge preview. These news did increase Sonic's exposure in the short term. But the current reality is that ecological prosperity is far from its peak. At present, the full competition of public chains such as Layer2, Solana, Aptos, and Sui has brought the market into an era where multiple chains are flourishing. High TPS is no longer the only selling point. If Sonic cannot break out one or two "key projects" within the ecosystem, it may be difficult to compete with other popular chains.

However, the launch of Sonic still received support from some industry star projects. In December, the AAVE community proposed a plan to deploy Aave v3 on Sonic, and Uniswap also announced that it had completed the deployment on Sonic. In addition, Sonic can also directly inherit the 333 staking agreements on Fantom as the ecological foundation. These are all advantages compared to a pure new public chain.

And rely on performance and high incentives to bring back funds and developers? The answer may depend on whether Sonic can deliver convincing answers in 2025 in terms of specific application implementation, governance transparency and cross-chain security. If all goes well, Sonic may be able to regain the glory of Fantom. If it is limited to conceptual hype, or cannot resolve internal conflicts and security concerns, this "second entrepreneurship" may also end in mediocrity in the multi-chain melee.