The FAT protocol is what we are calling a data-only protocol. FAT exists and functions as pure data! In contrast, Ethereum runs smart contract code in parallel across the network to function and reach consensus. Ethereum is a computational blockchain and it distributes computation and data across the network.
Our data-only protocols only share the data at the blockchain layer, and defer the computation to the users of the protocol to filter and validate the data according to the FAT protocols.
Sharding data storage is a problem that has been successfully solved and implemented in many production database systems, but sharding computation remains a very difficult challenge that plagues the scalability of many blockchains to this day and will for years to come. Building FAT as a data-only protocol allows it to leverage the fact that data storage is easy to shard to create very efficient tokenization.
Let's compare an ERC-20 token (Ethereum) and a FAT-0 token functionality:
| Criteria | FAT-0 | ERC-20 |
|---|---|---|
| Decentralized Blockchain | Y | Y |
| Decentralized & Trustless Trade | Y | Y |
| Decentralized & Trustless Issuance | Y | Y |
| Decentralized & Trustless Exchange | Y | Y |
| Decentralized & Trustless Code Execution | N | Y |
| Tokens Tradable in Fractions | Y | Y |
| Fixed Cost of Operation ($0.001 USD per transaction/KB, Forever) | Y | N |
| Tokens/contracts can be written in any programming language | Y | N |
| Functions without potential securities issues of the "gas" tokens | Y | N |
| Purchase "gas" in Fiat, no exchange/regulation | Y | N |
| Anchors into the oldest and most secure Blockchain: Bitcoin* | Y | N |
* = It should be noted that while Factom currently anchors into Bitcoin, it is blockchain agnostic and can be made to anchor into virtually any blockchain.
FAT is a data only protocol, it achieves consensus on the order, timing, and content of data using the Factom blockchain.
In Ethereum, a tokens behavior is defined by a smart contract's code which is run across the network, and held to its well defined rules by the miners via consensus. No signing with private keys on behalf of the issuer of the contract is needed because the contracts behavior can be trusted by everyone in the network. For example, I can send ether to a contract and get back an ICO token, guaranteed.
In FAT there are rare scenarios where it's difficult to get around this issue with application design, and issuers must listen for events so they can sign and submit data.
- They are crazy affordable. ($0.001/KB for FAT vs $2.86/KB & $3.83/KB for Ethereum and Bitcoin respectively at the moment). We're talking less than 1/1000th the cost of the competition.
- They are crazy easy to learn. FAT tokens are written in simple JSON and you can build on FAT in your choice of programming language. Libraries are available to facilitate easy contract module development.
- They are crazy flexible. Add whatever metadata you want to define custom programmatic behavior as an issuer. Contracts and custom token behavior can be written in any programming language. FAT standards can be layered and extended to achieve unique tokenization and smart contract functionality.
FAT TPS is equal to Factom's TPS. Currently Factom can do around 10 TPS stably, which is comparable to Ethereum. Factom can be easily sharded to accommodate increasing volume in the future.
Absolutely. Factom has a thriving and responsive Testnet that allows you to try FAT out at no cost. Additionally, the FAT wallet currently comes hardcoded with the private key to a pre-loaded Entry Credit address to fund issuance and transactions of FAT on the Factom mainnet.
You do. FAT is completely open source under Creative Commons 0. FAT's development and administration is spearheaded by DBGrow Inc., one of the 27 proud Factom Authority Members.
The FAT protocol stands for Factom Asset Token protocol, and is also a play on the concept of blockchains being “fat” protocols compared to other networks which act as “thin” protocols. The idea is that while the internet generated immense value, it was the application layer on top of the internet that captured that value rather than the network layer itself. Blockchain allows the network layer a better mechanism to capture value, and Factom’s two token system is the strongest mechanism in the blockchain space for capturing that value. We thought it fitting to name our tokenization protocol that exists as pure data within the Factom blockchain the FAT protocol, as value of activity in the Factom Asset Token protocol is captured directly as entry credit burn within the Factom blockchain, the best designed fat protocol in existence .
Read more on the concept of FAT protocols: http://www.usv.com/blog/fat-protocols