About IOTA

IOTA

What is IOTA?

IOTA is a revolutionary new, next generation public distributed ledger that utilizes a novel invention, called a “Tangle”, at its core. The Tangle is a new data structure based on a Directed Acyclic Graph. As such it has no Blocks, no Chain and also no Miners. Because of this radical new architecture, things in IOTA work quite differently compared to other Blockchains.

Highly Scalable

Increased network activity decreases transaction settlement times.

Zero-fee transactions

Send 1 cent and receive 1 cent, send $1,000,000 and receive $1,000,000.

Offline transactions

Devices never need perfect connectivity.

Low resource requirements

Designed for tiny devices, such as sensors, to participate.

Secure data transfer

All data is encoded, allowing secure data transfer, storage and reference.

Quantum Immune

Using special signatures IOTA is resilient to the next generation of computing.

The problem IOTA solves

Anyone with a bank account is familiar with the concept of a ledger, containing records of their debits and credits. Collectively, IOTA has all entrusted financial institutions for generations to safeguard these highly sensitive records and their accuracy. With no ability to verify the data that IOTA receives on the Internet today, and with cybercrime on the rise, this delegated and unverifiable trust has become a major obstacle for an inclusive and permissionless economy.

With the advent of distributed ledger technologies, IOTA is now able to distribute and synchronize ledgers of data and money in secure, distributed, decentralized and permissionless environments. By removing the need for trusted third-parties as the gatekeepers and arbiters of truth, enormous efficiency gains, innovation opportunities and new value propositions emerge.

Blockchain technology promised a compelling vision: decentralized networks allowing open innovation and peer-to-peer transactions without intermediaries or fees. Ultimately, they were never built to execute it in full, due to inherent technical flaws in their design. As blockchain adoption has increased over the last decade, early adopters have been hit with sluggish transaction times and skyrocketing fees. As financial rewards for validating blockchain transactions became increasingly competitive, their networks have also become increasingly centralised around a few powerful actors. But the need for decentralized and permissionless systems remains, and has only increased in recent years.

By solving the inefficiencies of the Blockchain, IOTA, based on the revolutionary distributed ledger technology, the Tangle, is the missing link for the Internet of Everything and Web 3.0. Powering a secure, scalable and feeless transaction settlement layer, IOTA will empower machines and humans to participate in flourishing new permissionless economies – the most important one being the Machine Economy which we are building.

IOTA Tangle

IOTA’s distributed ledger, by contrast, does not consist of transactions grouped into blocks and stored in sequential chains, but as a stream of individual transactions entangled together.

Blockchain Tangle

In order to participate in this network, a participant simply needs to perform a small amount of computational work that verifies two previous transactions. Rather than creating a hierarchy of roles and responsibilities in the network, every actor has the same incentives and rewards. In order to make a transaction in the Tangle, two previous transactions must be validated with the reward for doing so being the validation of your own transaction by some subsequent transaction. With this ‘pay-it-forward’ system of validations, there is no need to offer financial rewards. Transacting with IOTA is and will always be completely fee-free.

Moreover, without the need for monetary rewards, IOTA is not limited to transactional value settlements. It is possible to securely store information within Tangle transactions, or even spread larger amounts of information across multiple bundled or linked transactions.

This structure also enables high scalability of transactions. The more activity in ‘the Tangle’, the faster transactions can be confirmed.

For more details on how the Tangle works, please read the The Tangle Whitepaper.

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