Fantom’s Reinvention for DeFi Dominance

Sonic introduced a set of design and economic solutions aimed at long-term sustainability and growth. With an extensive ecosystem, no significant insider unlocks of the $S token, and a large pool of rewards, Sonic can compete not only with emerging blockchains like Berachain and HyperEVM, but also with established leaders such as Base, Solana, and Sui.

Architecture and Speed

Sonic is an evolution of the Fantom blockchain. While both blockchains were designed with a focus on delivering high-performance, scalable solutions for DeFi, the new Sonic blockchain brings improved performance, cost efficiency, and fresh incentives to enhance the experience for users and developers alike.

The biggest change lies in Sonic’s core architecture. While Fantom already used a Directed Acyclic Graph (DAG) structure in its Lachesis consensus system, Sonic enhanced this approach with a more optimized and tightly integrated DAG system. The DAG structure allows transactions to be processed asynchronously, which enables multiple transactions to be confirmed simultaneously, and the Lachesisconsensus mechanism is an asynchronous Byzantine Fault Tolerant (aBFT) protocol. This allows transactions to be processed asynchronously and in parallel, which enables higher throughput and near-instant finality.

While Fantom Opera could handle anywhere from 15 to 2,000 transactions per second (TPS), Sonic aims for much higher—up to 10,000 TPS. Transaction finality has also improved from 1–2 seconds to just 720 milliseconds in Sonic.

Sonic replaces the $FTM token with a new token called $S, which is exchanged at a 1:1 ratio. This move introduces deflationary mechanisms to gradually reduce the total token supply, which may benefit holders over time.

Moreover, Sonic has implemented a dual airdrop mechanism, which includes Sonic Points and Sonic Gems to incentivize participation in its ecosystem. Sonic Points are user-focused and are earned by holding or using whitelisted assets across DeFi apps, rewarding individual engagement with the network. In contrast, Sonic Gems targets developers, distributing airdrop points to apps based on their ability to drive user activity and innovation. These Gems will be redeemed for S tokens, which apps can then allocate to their users.

Complementing the airdrop, Sonic’s Fee Monetization (FeeM) program and Innovator Fund further empower its ecosystem. The FeeM program allows developers to earn up to 90% of the network fees generated by their apps, creating a sustainable revenue stream that reduces reliance on external funding and mirrors Web2 ad-revenue models. Meanwhile, the Innovator Fund offers up to 200 million S tokens from the Sonic Foundation treasury to accelerate app adoption and support groundbreaking projects. Together, these initiatives provide developers with financial incentives and resources, driving long-term ecosystem growth.

Sonic Gateway

​Sonic Gateway is the native bridge that facilitates token transfers between Ethereum and the Sonic blockchain. The bridging process involves depositing assets, processing transactions in intervals called “heartbeats” for gas efficiency, and then claiming the assets on the destination chain. Regular transfers from Ethereum take about 15 minutes to confirm, but on Sonic Gateway, they’re nearly instant. Additionally, for users who require immediate transfers, the “Fast Lane” feature allows transactions to be processed with priority for a small fee.

This is a major upgrade over Fantom Opera’s reliance on third-party bridges like Wormhole or LayerZero, which have additional security risks and slower finality. In contrast, Sonic Gateway is fully native, trustless, and optimized for both speed and user control, eliminating the vulnerabilities of external intermediaries.

Explosive On-Chain Metrics Growth

Sonic officially launched on December 18, 2024, and gained strong traction shortly after. On March 30, 2025, which is about 103 days after Sonic’s launch, Sonic has demonstrated a significant increase compared to the last day of Fantom. While there were only 1.6 million addresses on Sonic so far, it quickly surpassed Fantom in TVL and stablecoin supply, which is an important indicator that shows an ability to make money on chain.

The number of weekly active addresses has hovered around 150,000 in recent weeks, but the key metric is retention. Nearly 25% of weekly users are returning, helping to sustain a stable core user base.

Sonic ranked among the top blockchains by net inflow in Q1 2025, attracting nearly $1.3 billion in assets, on par with the newly launched Berachain. This places Sonic ahead of Solana and most other networks, with only Base drawing more capital.

The Sonic blockchain is designed to host a diverse and thriving ecosystem of dApps. Its full EVM compatibility enables developers to deploy applications that were originally built for the Ethereum network with no extra hassle. This feature lowers the barrier to entry for many developers and facilitates the migration of existing dApps to Sonic.

The Sonic blockchain ecosystem is primarily centered around DeFi, which drives most of the network’s activity and innovation. Sonic was designed to optimize for high-throughput, low-latency transactions, making it particularly well-suited for DeFi applications that require real-time performance and minimal fees.

The DeFi ecosystem on Sonic includes various categories such as lending protocols, classic AMM DEXs and the recently popular ve(3;3) DEXs, liquid staking, yield farming, yield-bearing stablecoins, and more.

Where is Money At?

Lending

Aave is the largest lending protocol, but it only appeared on Sonic in early March. Nevertheless, it is already the leading protocol on the chain by TVL with nearly $400M at the time of writing. Despite its traditionally modest yield and asset range, users prefer Aave because of its reliability and familiar experience. Currently, Aave on Sonic offers supply APYs of 1.13% for WETH and 0.74% for USDC.e. In comparison, on Base, these figures are higher, with 2.02% and 2.97%, respectively. ​This difference between networks is due to variations in supply and demand affecting utilization rates and governance-set interest rate parameters that can differ for the same asset across networks.

To incentivize deposits, Aave provides Sonic points ranging from 4x to 12x, depending on the asset. For instance, USDC.e depositors can earn up to 12x Sonic points due to high borrowing demand.

Silo Finance is the second largest DeFi protocol on Sonic is also a lending platform. Unlike its closest competitor, Silo offers more markets for lending including restaked tokens, yield bearing stablecoins, and synthetic assets. It also tends to provide higher yields for lenders.

A notable feature of Silo V2 is the introduction of “hooks”, programmable extensions that allow developers to deploy idle liquidity into other DeFi protocols. Hooks enable cross-market interactions and create fixed-term lending or permissioned markets for regulated assets.

Decentralized Exchanges

Shadow Exchange is built on the ve(3;3) model and utilizes a concentrated liquidity mechanism, which allows liquidity providers (LPs) to concentrate their resources in certain price ranges. The cumulative volume is $3 billion, which is almost half of the total DEX volumes on Sonic.

Concentrated liquidity pools increase capital efficiency and allow users to earn higher returns from trading and liquidity provision. Depending on the types of assets and the ranges at which liquidity is provided, APR varies from 10% to 10,000%. It is important to note that the rewards are generated in the native token $SHADOW. Rewards can be earned after a vesting period or immediately with a penalty fee.

The $SHADOW token has shown significant growth in February, reaching an ATH of $211 per token. However, at the moment, the token price has significantly declined, trading at $40-50 at the time of writing.

Liquid Staking

Beets is a DeFi yield platform built on Sonic that focuses on liquid staking and optimized liquidity pools. It allows users to stake $S tokens and receive a $stS token in return, which auto-compounds validator rewards. The native APR currently stands at 4.54% and can be increased by placing stS in other pools and protocols.

Pools represent an integration of Beets with other Sonic projects such as Silo Finance and Avalon Finance, which expands revenue opportunities. Yields in such strategies can be over 100%, depending on assets and boosted incentives from a third party.

Origin Protocol is another standout in the liquid staking sector, which offers a suite of products that optimize yield while keeping assets liquid. These include yield-bearing stablecoin Origin Dollar (OUSD), OETH and OS for liquid staking of ETH and S, respectively.

It leverages smart contracts to deploy assets into audited DeFi strategies, automatically accruing value for holders via a rebasing mechanism, where token supply grows daily as profits are redistributed, or through wrapped tokens that increase in value, ensuring compatibility with other protocols.

Yield Farming

Pendle is a yield trading platform launched on Sonic in late February 2025. Pendle focuses on tokenizing future yields, separating them into Principal Tokens (PT) and Yield Tokens (YT). While it’s established on other chains like Ethereum, its Sonic debut brought fresh opportunities for profit through yield strategies. Launching its first pools there in February 2025 with assets like stkscUSD and stkscETH. Pendle’s pools combinine yield trading with Sonic’s ecosystem incentives. On Sonic, Pendle transforms assets like Rings Protocol’s scUSD and scETH into staked, yield-bearing versions, enabling users to speculate on or hedge against future yields while earning additional rewards unique to Sonic.

Users can deposit assets into the Pendle pool to earn base yields, e.g. 9-17% APY from underlying strategies like liquidity provision. This is amplified by 24x Sonic points multipliers for stablecoin LPs, offering potential $S airdrop gains with no impermanent loss risk, plus trading PT/YT tokens for fixed or speculative yield plays (e.g., swapping 1,000 USDC.e to YT-aUSDC for points exposure). Additionally, users can place their PT tokens in third-party protocols such as Silo and Euler for additional incentives.

Royco is a platform for creating Incentivized Action Markets (IAMs). These markets let users earn rewards (tokens, points, etc.) for performing on-chain actions, such as staking, swapping, or depositing, defined by other users.

Through its Vault IAMs and Recipe IAMs, Royco empowers Sonic apps to incentivize liquidity provision, such as staking or supplying assets, while users earn boosted yields and maximized $S points without lockups. Potential Yields vary  between 2% and 17% APY based on underlying DeFi strategies, plus additional rewards like Sonic’s $S tokens from its 200M airdrop pool. For example, depositing $S into a Royco market might yield 139x Sonic points (convertible to $S), Royco Gem Bonuses, or partner incentives like Ring Points, stacking rewards atop vault yields.

Royco’s IAMs markets are trustless, atomic, and composable, offering a new way to drive DeFi growth. Royco supports deposits of a native token $S, as well as restaked tokens and stablecoins.

Other

Rings Protocol is a yield-bearing meta-stablecoin protocol designed to optimize liquidity and profitability. It introduces synthetic tokens pegged 1:1 to assets such as USDC, ETH, and BTC, which users can mint fee-free by depositing supported tokens on Ethereum and then bridging them to Sonic.

Users can mint scAssets that staked in Veda BoringVaults for automated yield farming, delivering yield from strategies like lending and rebalancing, with weekly Merkle tree distributions or rebasing options. Stakers also earn boosted Sonic points Veda points. Holders can deploy scAssets in Sonic DeFi for additional gains, while lockers fund projects for higher APRs.

The Bottom Line

Sonic’s emergence marks a bold evolution from Fantom, signaling a new chapter not only for the Fantom ecosystem but also for Layer 1 blockchain innovation. By integrating advanced technologies such as a DAG-based architecture and the Lachesis consensus protocol, Sonic sets a new benchmark in speed, scalability, and finality. With throughput reaching up to 10,000 TPS and sub-second transaction finality, Sonic has quickly positioned itself as a serious contender among leading Layer 1 blockchains.

However, this evolution raises key questions: Can Sonic gain a lasting foothold among the most popular L1 blockchains? Can its EVM compatibility and performance not only continue to lure projects from other blockchains but also create Sonic-native first projects? And how far can this hybrid of speed, incentives, and programmability push the frontiers of decentralized finance?