In order to understand what sets a project apart from all the others in the DLT space, one must always start from what motivated the creators to come up with such a project in the first place. In the case of IOTA it was the realization that certain problems will prevent the blockchain from fulfilling many of the use-cases which existed (and to an extent still do) only in theory. IOTA is arguably one of the major pioneering projects that took the concept of a DLT and implementing it with a different underlying data structure to solve many of the problems with Blockchain: fees, scaling, and centralization brought about by the need for validators or miners.
The result is a network that can easily handle huge amounts of data, which the creators hope will act as a catalyst for a true machine-to-machine economy, something which goes hand in hand with the emerging technological advancements we’re seeing in Artificial Intelligence as well as the Internet-of-Things.
David Stonstebo is the Co-founder and Co-Chair of IOTA Foundation; a new type of foundation, with the focus to develop the next generation of protocols for the connected world. Here, we ask David to explain the journey so far…
How did IOTA start?
“Sergey Ivancheglo, Dominik Schiener, Sergei Popov and myself were working on Annex II, the first proof of stake project. All of us had been in blockchains since 2011. We realized through working on this, that blockchain simply cannot scale and it really disqualifies itself from so many of the use cases that it’s touted as a solution for. The reason for this is very fundamental and very simple”.
David explains that one of the aspects are the fees on transactions, which automatically disqualify it as any kind of payment network. The other is the scalability limitation, which again, disqualifies it as a payment network, but perhaps even more importantly, it also disqualifies it from being a data transmission layer. The third thing, though more indirectly is the centralization versus decentralization.
“We all knew of these problems in blockchain from just a purely theoretical understanding of blockchain. But, it was really when Sergey Ivancheglo and I started thinking about how distributed ledgers to promise immutability, when applied to the Internet of things, did huge amounts of data and machine to machine interactions that need to be secured. In late 2014, we already kind of had a draft of very, very early Tangle and then throughout 2015 we started perfecting it, optimizing it and announcing to the world”.