The XRP Ledger (XRPL) is a worldwide payment and currency exchange network powered by Ripple. Though it’s been fine-tuned for this specific application, it has limited applicability for other tasks.
Flare Network intends to address this issue by facilitating the creation of XRP-based smart contracts.
Let's learn about Spark Token - FLR, Flare Network
What is a Spark Token (FLR)?
The Spark token is the network’s original cryptocurrency. Its primary function is to safeguard systems against spam assaults, same like other native tokens. If all financial dealings were free, the network would quickly become overrun with pointless transactions that serve no purpose.
- Here are some examples of how the Spark Token may be put to use:
- within the context of decentralized apps as security (DApps)
- to provide information to a decentralized database
♥Taking part in the administration of a protocol
These three pieces work together to facilitate the development of Spark-dependent apps (SDA). For networks that don’t have built-in support for smart contracts, SDAs may nonetheless make it possible for tokens to be represented in a trustless manner. Is there a glimmer of hope? Of course, this is where XRP comes into play.
The Flare Network is what?
With the help of the Ethereum Virtual Machine, Flare Network is a decentralized platform (EVM). As a result of the EVM, Turing-complete smart contracts may be executed on the network in the form of computer-readable instructions. Because it is Turing-complete, it can do any conceivable calculation so long as adequate memory is available.
This implies it has the potential to integrate many useful characteristics into an ecosystem for distributed software. Flare’s main goal is to facilitate the expansion of existing smart contract infrastructure.
Flare employs the Avalanche consensus mechanism, which has been modified for use with the Federated Byzantine Agreement (FBA). Many networks, like the XRPL and Stellar, employ FBA as a consensus method. We won’t dive into the specifics, but the consensus process used by Flare ensures that the network is secure without using economic mechanisms like Proof of Stake (PoS).
Let’s use the Ethereum network’s native currency, ether (ETH), as an example. Token holders who validate transactions will be solely responsible for the network’s safety after Ethereum 2.0 makes the move to Proof of Stake (PoS). This implies that the token (and the amount of it that is staked) is integral to the security. This is not necessary for the Flare consensus process.
But why exactly is this significant? Because it opens the door for the network token to be exploited in ways that might compromise the safety of networks that depend on it for authentication. The developers of Flare claim that this design decision increases the token’s flexibility without affecting its security.
The FXRP coin: what is it?
On the Flare Network, the XRP token is represented by the FXRP token, which does not rely on any third-party verification. Smart contracts allow holders of XRP to generate and redeem the token.
Participants who stake Spark Tokens as collateral and collect fees during the issuance and redemption of FXRP are also essential to the operation of the system. This, in addition to the possibility of arbitrage, ought to keep the XRP/FXRP exchange rate stable at its current 1:1 level.
Do you recall how I explained how Flare might be used to implement smart contracts on networks that didn’t otherwise support them? That is precisely the case with FXRP. This eliminates the necessity for a trusted third party to issue wrapped tokens in order to utilize XRP in smart contracts. In a word, in a dishonest fashion.