The Flare Network is the first Turing complete Federated Byzantine Agreement (FBA) network. Nodes run the Avalanche consensus protocol with a key adaptation to the FBA consensus topology. Furthermore, the network leverages the Ethereum Virtual Machine (EVM), enabling the network to run Turing complete smart contracts.
Flare token (FLR) is the network's native token used as a gas for paying transaction fees on Flare network. Additional tokens that represent other assets (called F-Assets) exist on the network; an example of such a token is a representation of XRP in Flare network, called FXRP. Similarly, WFLR tokens are wrapped Flare tokens used for delegation and governance.
The Flare Time Series Oracle (FTSO) protocol gathers price (and data) signals of off-chain assets and submits them to the Flare blockchain for calculation by other smart contracts; on-chain prices are updated every few minutes at "price epochs". It is a decentralized on-chain mechanism providing externally sourced time series data estimates to the Flare network, to maintain the system's integrity and utility, leveraging the distributed nature of the network and its participants.
A time series is a data feed of data points, such as e.g. the spot (current) price of FLR in USD (pair FLR/USD), that has already been processed by the FTSO and is hence available for use by smart contracts. The FTSO providers are producing different data time series, e.g. FLR/USD, XRP/USD, EUR/USD, FLR/BTC and FLR/LTC prices, where each price gets regularly updated at price epochs.
Provider of accurate data points is rewarded in newly minted FLR tokens, accordingly to the total amount of WFLR tokens held by the provider and the amount of WFLR tokens delegated to this provider.
Thus, the Flare oracle acts as an inflation mechanism for the network, increasing the FLR token supply for rewarding WFLR token holders who provide good estimates to the FTSO with newly minted FLRs. In this sense, it is the equivalent of mining, it acts as an economical incentive for FLR token holders to act honestly and provide value and trust to the blockchain.