About 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.
Increased network activity decreases transaction settlement times.
Send 1 cent and receive 1 cent, send $1,000,000 and receive $1,000,000.
A globally distributed network, IOTA is resilient and robust against attacks.
Designed for tiny devices with low resource requirements to participate.
IOTA transactions are confirmed within seconds.
With Winternitz signatures IOTA is resilient to the next generation of computing.
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 and Bitcoin 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’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.
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.
With the introduction of the Shimmer and Assembly networks, the IOTA ecosystem architecture has grown from one network to three. This expansion not only enlarges the opportunities each network represents but also the overall complexity of the IOTA infrastructure. This article outlines the core features and key functions of IOTA, Shimmer and Assembly as well as their interconnections, purpose and future.
The current IOTA mainnet (IOTA 1.5 Chrysalis) is the safe haven for users, developers and organizations, offering feeless transactions, a stable environment, excellent documentation and mature tooling, and support for various popular programming languages providing feature parity across them. Currently, the IOTA mainnet allows for ~1,000 feeless data and value transactions per second (tps).
The IOTA 2.0 DevNet features a new consensus mechanism, designed to fully decentralize the IOTA network. The first iteration of the DevNet was released in June 2021 and is continuously updated to further improve, harden and optimize the upcoming, fully decentralized version of the IOTA mainnet.
The Shimmer network will be the younger brother of the IOTA 2.0 DevNet, based on the consensus mechanism tested in the IOTA 2.0 DevNet. As node software, Hornet (and likely Bee) will be used instead of GoShimmer. It will act as a validation network for any IOTA features before they are integrated into the IOTA mainnet. Like the current IOTA mainnet, Shimmer offers feeless microtransactions but, unlike the current IOTA mainnet, will also regulate access to the network through Mana.
Assembly adds fully decentralized and scalable smart contract capabilities to the IOTA ecosystem. It is a highly scalable multi-chain network for sharded, composable smart contracts, implemented on the IOTA Smart Contracts framework. In addition, Assembly offers shared security, trustless interoperability, atomic composability on-chain and asynchronous composability via trustless and feeless cross-chain transactions.
With Chrysalis the IOTA Foundation makes a clear cut from the current IOTA protocol, and start a new with a much better, and more mature network. The new network will support many new use cases and create a foundation for IOTA’s upcoming Coordicide. The foundation will replace exotic aspects of the protocol with established standards and provide a wealth of new tooling for developers, enterprises and exchanges.
Chrysalis is the most extensive upgrade in IOTA’s history, touching all aspects of the protocol, libraries, wallets and software implementations developed by the IOTA Foundation. It truly marks “a new dawn” for IOTA, becoming production ready and forming a foundation for upcoming features like smart contracts and tokenization.
The IOTA Foundation is preparing to take its most important step to date in the maturity of the IOTA protocol — realizing the dream of a permissionless and scalable distributed ledger technology (DLT). The IOTA Foundation refer to this event as Coordicide: the death of the Coordinator.
Unlike other DLTs, IOTA’s solution does not compromise decentralization in any way.
Truly limitless scalability with no protocol-related bottlenecks. The network is limited by the laws of physics.
Feeless transactions enable the secure transfer of data and values between humans and machines, opening up new business models based on micro-payments.
Transactions reach finality in seconds without having to wait for confirmations by external entities.
Much like the Internet Protocol, a layered approach enables extension of the base protocol through additional modules.
The nonprofit organization behind IOTA drives the adoption and evolution of its free and open source technology without any collusion of interests with 3rd parties like miners.
The number of connected devices that will be in use is estimated to reach 75 billion by 2025. From tiny sensors on roads and bridges to wearable electronics, mobile phones, and more, every day the world is becoming more and more interconnected. The amount of data being produced and consumed by all these devices is already astronomical. By the end of 2016, the run rate of IP traffic was 1.2 zettabytes per year – or enough data to fill over 9 billion of the highest storage capacity iPhone’s available at the time. Over the next five years, global IP traffic is expected to increase five-fold whereby 2021, monthly IP traffic will reach a staggering 31 Gigabytes per capita.
But there is a significant problem. During the same period, broadband speeds are expected only to double, and the electromagnetic spectrum is a fundamental limit for wireless communication. The global data pipelines are becoming congested. It will not be possible for all these devices to continuously connect to centralized cloud silos for all the data they will produce, nor will it be possible for analytic engines in these clouds to respond back to the actuators to act on the data in real time. This is where ‘Fog’ and ‘Mist’ computing, storage, bandwidth, electricity enters the picture. One has to distribute these resources all across the landscape, which immediately brings up the question of how to do this in practice with all the red tape in place when there are 10s, 100s or even 1000s of stakeholders involved in this new Machine Economy. This conundrum was the cause of the inception of IOTA. Through zero fee transactions, these devices can share these technological resources amongst one another in real time locally in a distributed network, thus avoiding the centralized points of failure, unclogging the resource infrastructure and abide by the laws of physics.
