The price action of Optimism (OP) and Fantom (FTM<\/a>) tokens have been quite identical since the last quarter of 2022. The difference is that volatility is slightly higher for OP, which surged 240% year-to-date, compared to the 180% gains seen in FTM.<\/p>\n The Fantom Foundation has made several improvements since Q4 2022, which have catalyzed an uptrend<\/a> in the token\u2019s price. However, Fantom\u2019s ecosystem remains primitive while its competitors expanded to support new use cases.<\/p>\n On the other hand, Optimism has shown robust community and decentralized application (DApp) development thanks to the loyalty of Ethereum developers and the Optimism Foundation\u2019s effective strategy in aligning token incentives with governance.<\/p>\n The Fantom ecosystem received an adverse blow in early 2022 due to the departure of leading DeFi architect<\/a> Andre Cronje. The blockchain\u2019s ecosystem development stalled after Cronje\u2019s departure. At the same time, Fantom\u2019s competitors, like Polygon\u00a0(MATIC<\/a>), Cosmos (ATOM<\/a>), Arbitrum and Optimism, continued to host various popular applications<\/a>.<\/p>\n Cronje rejoined Fantom development efforts in November, however, it appears it was too late by then. The lack of sustainable yields in a bear market has restricted liquidity inflows to Fantom.<\/p>\n The Fantom community also aimed to improve the quality of decentralized applications on the blockchain through an ecosystem development fund<\/a> built by reducing the portion of burnt fees from 20% to 5% in December. While the number of smart contracts created on Fantom has spiked significantly since Q3 2022, the quality of DApps still needs to improve compared to its competitors.<\/p>\n The 30-day activity billboard from Nansen shows that top dApp activity on Fantom was limited to simple swaps, which is discouraging as other activities like derivatives trading, social media platforms and NFT trading are prospering on competing chains like Arbitrum, Polygon, and Optimism. <\/p>\n The most used DApps on Fantom between Jan. 20 and Feb. 20 was XEN Crypto, a free mint Ponzi scheme-like application. The application first appeared on Ethereum<\/a> in October, with a lot of excitement in the first few days of launch. However, the hype subsided after the mint became unprofitable as many users crowded the platform.<\/p>\n At the same time, Optimism has successfully attracted liquidity and activity to its ecosystem after launching the Optimism token and accompanying airdrop campaigns. In April<\/a>, the Optimism team stated there would be a \u201cseason of airdrops\u201d and launched an Optimism Quest campaign.<\/p>\n The layer-2 network saw increased usage from users for collecting its nonfungible tokens, which would likely make them eligible for the airdrop. The Quests ended in January, following which there was a steep decline in activity. However, DeFi liquidity remained sticky.<\/p>\n Moreover, the activity on Optimism is quite diverse. The list of most used decentralized applications on Optimism includes yield platform Pool Together, derivatives platforms Synthetix and Perpetual Protocol and leading lending platform Aave.<\/p>\n Optimism also hosts a decentralized blogging platform, Mirror, which allows content writers to issue their articles as NFTs. The platform has gained significant usage, with 2.7 million hits<\/a> on its website.<\/p>\n On Feb. 24, the largest U.S. exchange,\u00a0Coinbase, announced its layer-2 blockchain<\/a>, which uses the same technological design as Optimism. The announcement added that the exchange is closely working with the Optimism Collective with a vision to connect blockchains built on the same technological stack, collectively known as the Optimism ecosystem. This could possibly be the beginning of a big step for Optimism where other businesses follow Coinbase into joining and enhancing Optimism\u2019s liquidity and activity.<\/p>\n One drawback of the Optimism token is that it is only a governance token and doesn\u2019t entitle users to real yields in gas fees. The OP tokens\u2019 supply will inflate at 2% per year, along with investor and team unlocks that begin in April.<\/p>\n However, the Optimism team has incentivized participation in governance, which improves the protocol\u2019s governance and also aligns incentives with its intended use, i.e., higher voter participation.<\/p>\n Optimism\u2019s governance has proved more efficient than competitors<\/a> like Uniswap (UNI<\/a>) and Compound (COMP<\/a>) in promoting decentralization<\/a>. The layer-2 network\u2019s ecosystem is also expanding by supporting diverse applications. Optimism also stands to benefit from Arbitrum\u2019s native token launch, which will likely add fuel to the layer-2 token narrative, pushing the OP token\u2019s price higher. <\/p>\n Related: <\/em><\/strong>Vitalik shows support for Optimism\u2019s governance structure and OP gas proposal<\/em><\/strong><\/a><\/p>\n![](\"https:\/\/s3.cointelegraph.com\/uploads\/2023-02\/819a603a-0c3e-425a-8286-dcec2fa8793c.png\")
Fantom\u2019s ecosystem development stalls<\/h2>\n
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Optimism developers find success with new use cases <\/h2>\n
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Comparing the tokenomics of FTM and OP<\/h2>\n
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