Coin Metrics: Architecture and technical interpretation of Flow blockchain

What is Flow?

The Flow blockchain mainnet launched in 2020 to lay the foundation for consumer-centric applications and the digital assets they support. Flow is a fast and developer-friendly Proof-of-Stake (PoS) Layer 1 blockchain built for large-scale decentralized applications, based on a multi-role architecture for scalability and Cadence, a resource-oriented programming language designed for smart contracts. The network uses Cadence as its primary execution environment, which has become the foundation of the Flow ecosystem of applications - from digital collectibles and official licensing platforms such as NBA Top Shot to marketplaces, DeFi services, and digital experiences in partnership with Disney.  

Crescendo Upgrade: EVM on Flow

In September 2024, Flow underwent its biggest change, the “Crescendo” upgrade, making the network fully EVM-compatible. The network now supports two environments: Cadence-based native chains (FLOW_NATIVE) and EVM-compatible chains (FLOW_EVM).

With this upgrade, any smart contract or protocol running on Ethereum or EVM Layer 2 can now be deployed on Flow, taking advantage of the flexibility of its account model. Flow introduces Cadence Owned Accounts (COAs), which act as smart contracts, unlike traditional external owned accounts (user wallets). This allows for native features such as account abstraction, multi-signature authentication, and custom key management, enhancing security and user experience. Flow can now leverage the network effects of EVM tools such as Metamask and integrate applications such as Uniswap and Chainlink, further expanding its ecosystem of developers, applications, and users. Since the upgrade on September 4, more than 1,000 new EVM contracts have been deployed on Flow.

Notably, this change will allow for composition in both environments, with the FLOW token acting as gas for transactions, and the native VM token bridge allowing for fungible and non-fungible token transfers between environments.

FLOW TOKENS AND TOKEN ECONOMICS

FLOW is the native token of the Flow blockchain. It serves as a means of rewarding staking participants in the network, a medium of exchange in the Flow ecosystem, and to pay transaction fees. Additionally, FLOW can be used as collateral in lending applications such as Increment Finance, as well as for governance voting on future protocol and ecosystem development. Currently, FLOW’s token price is $0.53 and its market capitalization is close to $800 million.  

Source: Coin Metrics Network Data Pro

Flow's genesis block was on October 1, 2020. Created in June, with 1.25 billion FLOW, of which the supply has been distributed to stakeholders in the ecosystem.

Source: Coin Metrics Network Data Pro

Scaling through multi-node architecture

Collection nodes enhance the network connectivity and data availability of dApps

Consensus nodes determine the existence and order of transactions on the blockchain

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Execution nodes perform calculations associated with each transaction

Validation nodes are responsible for controlling execution nodes

Source: Flow Blockchain

Block Time and MEV Elasticity

The separation of block production between different node types provides strong Maximum Extractable Value (MEV) resiliency. Each node type can access only the information it needs without having to know the status of block production, which allows for more predictable gas fees and improved user experience.

This architecture helps Flow maintain a low block time of 1.3 seconds, which has dropped to 0.8 seconds after the upgrade. This makes Flow one of the protocols with the shortest average block time among other layer 1 protocols. This fast finality creates a better user experience and makes it a good fit for applications that require fast transaction processing and confirmation of user actions.

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Source: Coin Metrics Network Data Pro

Source: Coin Metrics Network Data Pro

Source: Coin Metrics Network Data Pro

The number of transactions peaked in June, approaching 120 10,000 transactions, with an average daily transaction volume of about 300,000 transactions, which has recently soared to 470,000 transactions. With the advancement of EVM implementation, the average daily transaction volume has reached 12,000 transactions.

Source: Coin Metrics Network Data Pro

Conclusion

Flow’s unique multi-role architecture, Cadence programming language capabilities, and EVM compatibility make it a leader in layer-one environments, solving the complex tradeoff between scalability and interoperability. As the Crescendo upgrade brings EVM equivalence to Flow, its existing functionality and application ecosystem can be supplemented by the EVM ecosystem, increasing developer flexibility, user experience, and ultimately expanding its user base. The network data metrics highlighted in this report will continue to provide transparency into the usage, adoption, and economy of the Flow blockchain.