Flare is a layer 1 blockchain focused on data accessibility and management, utilizing the Ethereum Virtual Machine (EVM) smart contract platform. Its main goal is decentralizing data, ensuring universal accessibility without central control. ^[1]

Overview

Founded in 2019, Flare is a platform designed to enhance data accessibility for blockchain developers. The system is supported by infrastructure providers who serve as validators and data sources, ensuring the functionality of two key native oracles \

• FTSO and the State Connector. These oracles play a crucial role in cost-effectively simplifying data access for developers on the Flare network. It also includes LayerCake, developed by Flare Labs, a decentralized bridging and cross-network composability protocol with in-transit insurance.^[2][1]

Flare Protocols

The Flare Time-Series Oracle (FTSO)

The FTSO within the Flare network offers ongoing, decentralized, and secure estimations for diverse data types. Independent data providers retrieve data from various sources, and the FTSO system calculates a final estimate based on weighted input. Originally designed for cryptocurrency price pairs, the FTSO now supports all data types. Data providers offering valuable contributions receive rewards, and the resulting data estimates are published on-chain for usage. Key aspects covered include the FTSO workflow, result calculation, vote power, delegation, and guidelines for developer interaction. ^[3]

Procedure

Any Flare network user can act as an FTSO data provider and submit data. During each epoch, the system considers submissions from the top 100 data providers with the highest vote power. Data submissions should reflect current prices (in $USD) for supported cryptocurrencies. The submission process ensures privacy through a commit-and-reveal mechanism conducted in rounds. The FTSO system calculates the median value, considering each provider's vote power. Resulting data estimates are publicly available for 5 price epochs. Data providers and their delegators are rewarded for closely aligned data submissions in each epoch. Accumulated rewards can be claimed after the respective epoch.^[3]

Results

In the Flare Time-Series Oracle (FTSO), a single estimate is computed for each price pair using all submitted data from data providers. Price epochs last 3 minutes. Each submission is associated with a price and weight based on the data provider's vote power. The resulting price for the price epoch is the weighted median of all submitted prices. Submissions within the top and bottom 25% range do not receive rewards. ^[3]

Vote Power

In the FTSO, data providers' submissions are weighted by their vote power, linked to their holdings of wrapped Flare or Songbird tokens ($WFLR or $WSGB) and delegated amounts. To maintain equitable influence, an upper limit caps an individual's impact at 2.5% of the total vote power on both Flare and Songbird. During each reward epoch, a snapshot captures a data provider's vote power, defining their weight for the subsequent epoch. This snapshot, known as the vote-power block, is randomly chosen from the last blocks of the prior epoch. Block production time variations determine the specific block selection, roughly the last 50% of blocks for Flare and approximately the last 25% for Songbird. Regular reward epochs follow a set pattern, repeating every 7 days for Songbird and every 3.5 days for Flare.^[3]

State Connector

The State Connector, a fundamental element of the Flare network, serves as a mechanism to securely access verifiable, unchanging data from external chains and the internet. Operating as a smart contract, it offers users the capability to query this type of data. The State Connector operates in a decentralized and secure manner, relying on independent attestation providers to retrieve and validate information. Data is then made available on the network through a consensus process.^[4]

Procedure

The State Connector processes user queries, with a focus on accuracy and privacy. Users initiate queries to verify specific events, which are then transmitted to attestation providers with gas cost optimization. Attestation providers retrieve data from diverse sources based on the type of attestation required. Answers are submitted through a confidential "Commit and Reveal" protocol. Validity is determined by a minimum 50% consensus among attestation providers, prompting resubmission if consensus is not met. The State Connector stores the resulting answers within its smart contract for a week, providing access to users.^[4]

Attestation Protocols

Flare incorporates two crucial protocols to ensure efficient operations. First, the Overlapped CCCR Protocol, streamlines handling requests and answers in attestation rounds, aiming to minimize delays between rounds. Second, Attestation Packing, involves consolidating valid answers into a single hash using Merkle trees during each round.^[4]

Branching Protocols

The State Connector incorporates branching protocols to enhance security by enabling validator nodes to halt execution and fork in cases of disagreement among trusted attestation providers. Two critical provider sets are defined: the Default Set, relied upon by all validators, and the Local Set, allowing operators to specify additional trusted providers. To ensure a successful attestation round, consensus within both sets is necessary. In the event of a fork, resolutions differ based on whether the discrepancy is in the local or default set of providers. ^[4]

Layercake

LayerCake, under development by Flare Labs, embodies a decentralized bridging and cross-network composability protocol with in-transit insurance. It emphasizes heightened security, speed, scalability, and functionality for bridging across various smart contract networks. It facilitates streamlined automated actions within the bridging process. ^[5]

Process

The LayerCake process involves ensuring transfers using collateral backed at a 1-to-1 ratio by the actual asset being moved, ensuring low-latency trustless bridging. Once the transfer is complete, the collateral (referred to as "bandwidth") is unlocked after a short period, determining the value that can move across the bridge simultaneously. Bandwidth collateral is supplied by the bridge's operators, known as bandwidth providers, who charge a small fee for each transaction. The bridge's total bandwidth dictates the amount of simultaneous traffic. LayerCake utilizes a multilateral approach to prevent liquidity fragmentation.^[5]

Flare (FLR) Token

Flare token (FLR), formerly Spark, is the inflationary token within the Flare ecosystem, utilized for smart contracts, transaction fees, and FTSO-generated FLR tokens. It aims for consistent usage costs, enabling various applications like DeFi, NFTs, metaverse, and gaming.^[6][7]

Songbird (SGB) Token

A canary network is a functional blockchain with a designated token supply used for testing new features in a live environment before deploying them to the primary network, differing from testnets with unlimited tokens. Users on a canary network are genuine, recognizing its experimental nature. Flare's canary network, Songbird, marks the initial stage in Flare's governance system. Its core roles include testing Flare's technology, aiming to offer developers a live testing environment, and functioning as the lower legislative body in the network's governance structure.^[18]
Songbird's SGB token, distributed to all FLR recipients on a one-time basis, contributes to governance decisions, specifically regarding the inclusion of additional chains, pricing mechanisms, and FAssets within the FTSO and FAsset protocols.^[19]

Flare Beta

The Token Distribution Event and simultaneous Beta Phase Launch took place on January 9, 2023. During the beta phase, Flare implemented a dual-validation system involving professional infrastructure providers and validators from FTSO participants. The structure comprises 5 validators from the Flare Foundation, 15 validators from Professional Infrastructure Partners, and potential participation from up to 100 FTSO validators. This phase aimed for a seamless transition of validation power from infrastructure partners to the FTSO group, ultimately leading to exclusive FTSO validator operation. Validator rewards, constituting 20% of inflation, were evenly distributed between infrastructure partner validators and FTSO validators, while Flare Foundation validators did not receive rewards. Key infrastructure providers were actively setting up Flare Validators for this phase, expected to last 6-9 months without affecting network economics, tokens, or delegations.^[13]

$FLR Token Burn

On October 13, 2023, Flare announced that they would be burning 2.1 billion $FLR tokens. This action followed the earlier airdrop of tokens to XRP holders who retained their holdings during a network snapshot in December 2020. The decision to burn 2% of FLR's total supply aims to enhance the ecosystem's health and development. The tokens designated for Flare's early backers were originally reserved for them but were ultimately burned following discussions and an agreement in response to Flare Improvement Proposal, FIP.01. Approximately 198 million FLR tokens were initially burned on the day of the announcement, with an additional 66 million tokens scheduled to be burned monthly until January 2026, when the FlareDrop process completes. This move, valued at around $20 million, contributes to reducing dilution and incentivizing new users to join the network. ^[15][16]

"We are very happy to have reached an agreement with our shareholders and thank them for their support. It is right that investor token allocations should also be affected by the changes implemented in FIP.01. Without this burn, the investors would be able to claim approximately 3x their original allocation through the FlareDrops, unfairly diluting community holdings.” - Hugo Philion, CEO & Co-Founder of Flare

Team

• Hugo Philion: Co-Founder & CEO
• Sean Rowan: Co-Founder & Chief Product Officer
• Dr. Naïri Usher: Co-Founder & Chief Scientist
• Tim Bukher: Chief Operating Officer & CLO
• Jaime Abromovitz: Chief Growth Officer
• Amaan Jalwa: Chief Financial Officer
• Gabe Bassin: Chief Investment Officer
• Josh Edwards: VP Engineering^[14]