To combine two technologies—IoT and blockchain, to reduce transaction fees to zero
Pros & Cons
- Based on the innovative Tangle, which speeds up transactions
- No transaction fees
- Iota coins haven’t been distributed fairly
- Since the transaction fee is zero, users are not motivated to host nodes. As a result, confirmation time increases.
- Uses Tangle, which includes blockchain features, improves DAG technology, and includes a peer-to-peer network relying on the mechanisms of validation and consensus
- Faster transactions
- Transactions are 100% free of cost
- Unlimited scalability and growth of data
- Does not involve any mining
- Environment friendly
- Sergey Ivancheglo, David Sonstebo, Dr. Serguei Popov, and Dominik Schiener
- IOTA Foundation
- GitHub Last Updated
- Dec 24, 2017, 10:36 AM GMT +5:30
Overview of IOTA
IOTA is a distributed ledger technology that was created to support the Internet of Things (IoT). No other blockchain technology features unlimited scalability, decentralization, and quantum resistance while simultaneously functioning as a lightweight distributed ledger. Although derived from the blockchain technology, it is much more than just blockchain technology. Being far ahead of the times, it has attracted a lot of attention from Techcrunch, Forbes, Huffington Post, and International Business Times. Many universities have realized the market potential of the technology and have decided to partner with it. To get a complete understanding of the technology, you have to read its White Paper.
Who Founded IOTA?
The founders of IOTA are David Sonstebo, Dominik Schiener, Sergey Ivancheglo, and Dr. Serguel Popov. When the platform was founded, 2,779,530,277,761 Miota were also created. This is a fixed number, which means that additional Miota cannot be created. Since the IOTA platform does not involve any mining, extra currency units cannot be created. A few months after its founding, the platform entered the beta stage. The beta testing continued throughout the next year and over-the-counter trading continued among the users during the eleven months that followed.
In 2017, a venture capital company called Outlier Ventures, invested a huge seven-figure amount into the platform. This was the company’s first investment into a cryptocurrency. As the transaction fees of Bitcoin shot up, SatoshiPay announced that it would migrate from bitcoin to Miota. In August 2017, the IOTA Foundation signed a partnership deal with REFUNITE, the biggest missing persons’ database in the world. IOTA technology, therefore, began being used to reunite missing people with their families.
Robert Bosch Venture Capital, another capital venture company, saw the market potential of the technology and purchased a large number of IOTA coins. This further increased the credibility of the new technology.
The Tokyo Metropolitan Government invited the IOTA Foundation to take part in the Blockchain Business Camp Tokyo. Companies such as Toyota, Honda, and Sony also took part in this event.
Reasons to Use IOTA
The world of cryptocurrencies is definitely interested in IOTA, chiefly because the platform is making full use of a unique niche—the Internet of Things (IoT). Miota has already established itself in a strategic position on cryptocurrency charts. It is among the top ten digital currencies in the world. Moreover, it has signed strategic deals with global technology firms such as Microsoft, which has greatly increased its credibility although experts are skeptical about the flawlessness of its proprietary software.
Here is a list of reasons to invest in Miota:
The Internet of Things (IoT): The IoT is the biggest reason to invest in Miota because the IoT is indeed the biggest technological development right now. International tech firms are not only interested, but also attempting to grab their share of the market. They have already understood the potential of IoT, which is expected to reach a market value of more than $1000 billion by the next 12 years. Smart devices will continue to be the center of attention, and this will further intensify the focus on IOTA. The platform has launched a project to develop a product that will enable you to sell the information on your device anonymously and securely. These developments are sure to make IOTA attractive for users as well as investors.
Sophisticated Proprietary Technology: IOTA has developed Tangle, which is currently not associated with any other cryptocurrency. It is a directed acyclic graph (DAG), a protocol that puts IOTA in a superior position when compared to the other blockchain platforms out there. It makes the platform rich in features such as zero transaction fees to limitless scalability.
Zero Fees: Transactions on blockchain networks are not free, and most of the time, the fees serve to enrich the miners. While the fees for Bitcoin transactions are higher, those for Litecoin transactions are lower. The exact fee varies from one platform to the other. But users of the IOTA platform don’t have to worry about fees because the transactions are 100% free. There is no proof-of-work system and no mining. The users randomly validate transactions.
Scalable: Tangle comes with infinite scalability and can therefore accommodate an unlimited number of users. In case of Bitcoin and Ethereum, the system slows down whenever the number of users increases.
You Don’t Have to be Online: Here is another great advantage that put IOTA in a superior position when compared to other cryptocurrencies—you don’t have to be online. IOTA’s software platform Tangle allows transactions even if you are offline. The network’s nodes inform the platform as soon as you come online. This feature makes it possible even for those residing in remote areas to become a part of IOTA’s blockchain platform. In brief, you don’t have to depend on the Internet when you use IOTA.
How IOTA (Miota) Works
The most innovative feature of IOTA is Tangle. In fact, it is the very soul of the IOTA platform. In technical terms, the IOTA network is a public ledger based on the “directed acyclic graph (DAG).” Unlike Bitcoin, there are no blocks and no mining. Instead of creating blocks, a transaction on the IOTA network is confirmed by at least one transaction that follows it.
This results in the nodes and network gaining a structure that can be shown as a direct graph without directed cycles—a light structure that looks just a tree with unlimited branches.
So how does the platform verify transactions without creating blocks? In case of other blockchain technologies, we either have proof of work or proof of stake. In case of proof of work, miners bear the responsibility of getting consensus. In case of proof of stake, stakers bear this responsible. In case of IOTA, the entire network of participants bears the responsibility of validating transactions.
Each transaction takes place in the following three steps:
Step #1: You initiate the transaction by using your private key to sign it.
Step #2: A couple of unconfirmed transactions are selected using the Markov Chain Monte Carlo (MCMC) algorithm and checked for conflicts.
Step #3: A cryptographic puzzle is solved to validate the transaction.
When the above three steps are successfully concluded, the transaction is validated and added to the network.
Value of Miota
The price of IOTA shot up in January 2018. For the second time in 2017 – 18, the price went higher than $4. But now the value of Miota stands at slightly more than $2. This indicates that Miota is just as volatile as the other altcoins out there. You can invest only if you have money that you can afford to lose. The value of IOTA rose by 464% last year, but experts say that the platform might have certain security flaws in it. If this is true and the security flaws are brought to light, the value of the altcoin is sure to decrease.
Future of IOTA (Miota)
According to the research conducted by Gartner.com on the Internet of Things (IoT), as many as 8.4 billion devices were connected through IoT in 2017. Although IOTA is among the first platform to combine the technology of cryptocurrencies with IoT, this fact alone cannot guarantee its success in the future. IOTA, like all other digital currencies, can become successful only through adoption and implementation. The latter depends heavily on the efforts of the team at IOTA Foundation. The former will be slow because users and manufactures of IoT hardware need to be convinced to transact with Miota.
At the time of writing, not much is known about IOTA. The little information that is available is very technical and difficult to understand. One can see, however, that the network is working well, but is not decentralized right now. It includes Coordinator, a special node operated by the Iota Foundation. Its purpose is to protect the IOTA platform till it develops immunity to large-scale spam attacks.
The IOTA team currently has a number of experienced developers and more are joining it as the days pass. If things go well and the team is successful, nothing can stop IOTA from being widely adopted. If that happens, it could be the next bitcoin.
At the same time, one has to take into consideration the fact that IOTA is based on proprietary technology that may have a number of scalability and security flaws. The future of IOTA, therefore, like the future of any cryptocurrency platform, is fraught with uncertainties. IOTA is definitely not a scam, but you must invest in it only after conducting research on its founders and technology.
Where and How to Buy IOTA (Miota)
There are several ways to purchase IOTA and here is an interesting list:
Method #1: If you are a credit card holder, you will find it very difficult to use it to purchase IOTA. You have to first register at Coinbase and use your credit card to purchase bitcoins. Coinbase allows residents of US, Singapore, Australia, and Europe to buy bitcoins with their fiat currency. Once you have received your bitcoins, you can convert them into IOTA at Binance.
Method #2: CoinMama is an exchange that allows people from all over the world to purchase bitcoins with credit cards. You can then convert your bitcoins into Miota (IOTA’s cryptocurrency) at Binance.
Method #3: If you are a resident of Singapore, Australia, US, or Europe, you can use your bank account to purchase bitcoins at Coinbase and other exchanges. The next step is to head over to Binance to convert those bitcoins into Miota.
Method #4: There is an indirect way of purchasing Miota through PayPal. You have to first use the service to buy bitcoins and then convert those bitcoins into Miota at Binance or similar services.
Method #5: If you are a resident of Europe, you can use BitPanda to purchase bitcoins through Skrill. The next step is to just exchange them for Miota at Binance or similar services.
Instead of purchasing bitcoins, you can also purchase Ether coins and convert them into Miota at services such as Binance. You may be wondering why it is not possible to purchase Miota directly. Most altcoins are indirectly purchased because of the excellent liquidity that bitcoin enjoys.
Download the IOTA Wallet
You can visit the Iota Wallet and download the open source software that is available on GitHub. The wallet comes with the following features:
- Free to use
- Native mobile apps
- Sophisticated security system
- Open source software
The native Iota mobile wallet app can be obtained at the Google Play Store for owners of Android device. The team behind the Iota wallet comprises Sascha N., the programmer and researcher; Oliver N., the Android developer; and Adrian Z., the lead developer.
You can donate to the team in bitcoins or Miota. You can contact the team by using an online contact form on the official Iota Wallet website.
Click on the following resources to increase your understanding of IOTA: