IOTA Q1 2026 Progress Update

In the first quarter of 2026, IOTA solidified its strategic pivot toward becoming the primary infrastructure provider for global trade. This evolution is detailed in the recently published IOTA Manifesto, which outlines a vision for a neutral, open, and scalable digital infrastructure to power the global economy. We encourage all community members and partners to read the Manifesto to understand our long-term commitment to digitalizing international trade.

This quarter’s progress is defined by the transition of the Trade Worldwide Information Network (TWIN) to operational phases and the successful rollout of core protocol developments that can support global-scale trade transactions.

Q1 2026 at a Glance

1. Protocol Evolution: Successful rollout of Starfish consensus to Testnet and the introduction of Account Abstraction core on Devnet.
2. Trade Infrastructure: Established TWIN’s presence in the UK’s Digital Trade Testbed and established multi-node connectivity between key Kenyan agencies.
3. Enterprise Adoption: Strategic pivot toward technical consulting and ecosystem support, marked by significant interest in tokenized trade finance from tier-1 financial hubs in South Korea and the Middle East.
4. Ecosystem Maturity: Integration with major exchange partners and the launch of the IOTA Expert Advisory Board to bridge the gap between DLT development and global logistics expertise.

Research & Development (Core Protocol)

In Q1 2026, the IOTA Foundation’s R&D department focused on protocol stability and high-performance features designed to support the heavy throughput requirements of global trade.

Core Protocol & Consensus

• Starfish Consensus Launch: Version v1.16.0 successfully brought the Starfish consensus mechanism to IOTA’s Testnet, providing the high security and low latency foundation required for trade documentation.
• Protocol v20 & IIP-8: IOTA Mainnet received the IIP-8 upgrade, introducing dynamic minimum validator commissions based on voting power to prevent concentration and encourage decentralization.
• FastCommitSyncer: A new synchronizer was implemented and tested, increasing synchronization speed by 20-30x, allowing faulted nodes to catch up in minutes rather than hours.

Smart Contract Platform, VM & Tooling

• Account Abstraction (AA): AA core features went live on IOTA Devnet, Alphanet and Testnet, enabling programmable address authentication to simplify the user experience for non-crypto trade participants.
• Proposals in Review: Two key IOTA Improvement Proposals were finalized to formalize the protocol’s evolution: IIP-0009 (AA Specification) and IIP-0010 (Package Metadata).
• IOTA Names: Successfully launched on Mainnet, IOTA Names now allows for human-readable identifiers and direct renewals.
• IOTA Identity 1.9: Released with SD-JWT upgrades to ensure compatibility with W3C Data Model 2.0 standards.

Infrastructure Performance

• Indexer Upgrades: New Indexer servers were deployed across all networks, delivering an approximately 80x performance gain for data-heavy applications.
• gRPC Integration: Core services, including the IOTA Indexer and GraphQL API, were refactored to utilize a high-performance gRPC node API.

Token Migration

• The IOTA Foundation successfully re-enabled the legacy token migration tool on Mainnet this quarter.

Trade Worldwide Information Network (TWIN)

The TWIN ecosystem is scaling digital public infrastructure to facilitate global trade through verifiable data.

Adoption

• TLIP Multi-Node Connectivity: Secure node-to-node communication was established between the KenTrade, Kenya Revenue Authority, and TLIP Community nodes, ensuring data remains at the source while allowing shared visibility. Look out for our blog post about this soon.
• Rwanda Expansion: IOTA successfully introduced Rwandan government stakeholders to TLIP to explore a coffee export pilot in collaboration with TradeMark Africa.
• ADAPT: Formal mobilization for the AfCFTA-led ADAPT initiative commenced, focusing on establishing governance structures and initiating priority recruitment for phase 1 implementation.
• TWIN Foundation: A Steering Committee meeting was held  in Nairobi on February 24th and 25th.

UK Port Initiatives

• Teesside Port ISN: IOTA agreed to establish an Information Sharing Network at the Teesside Port facility, a strategically important UK Digital Trade Testbed in collaboration with the UK Department of Business and Trade and the International Chamber of Commerce. (Read more: Turning Pilots into Progress).
• IOTA Expert Advisory Board: The Foundation launched the IOTA Expert Advisory Board to bring senior trade, customs, and logistics expertise directly into TWIN’s strategic development.

Global Market Interest

• Strategic Expansion: There is a significant increase in interest from tier-1 financial institutions and market infrastructure players in South Korea and the Middle East, particularly regarding tokenized trade finance and digital identity.

Communications & Ecosystem

In Q1, efforts remained focused on amplifying builder success and formalizing IOTA’s narrative as an infrastructure leader.

• Exchange Integration: IOTA achieved a major ecosystem milestone with the Bullish exchange integration, enhancing liquidity and institutional access to the network.
• Hackathon: The MasterZ × IOTA Hackathon saw over 60 teams submit structured product concepts, many of which cluster around trade, RWA, and identity.
• Media Outreach: The department secured substantial coverage regarding IOTA’s UK trade initiatives and Cabinet Office secondments. Moving forward, we will strategically prioritize outreach to trade and logistics media outlets to extend visibility beyond the Web3 space and position IOTA more clearly as infrastructure for global trade and supply chains.
• Community: We encourage deeper engagement around trade and supply chain topics. Community members who want to contribute meaningfully in these areas, or who can leverage relevant industry connections, are warmly invited to get involved and help drive IOTA’s success in real-world adoption.
• Social Reach & Engagement: This quarter saw 320 posts, resulting in 1.5 million impressions and 41 thousand engagements. In terms of PR, nearly 50 news articles about IOTA were published, mostly covering the release of the IOTA Manifesto.

Legal & Governance

The IOTA Foundation’s Legal & Regulatory Affairs team continues to engage with regulators across the globe and support the Foundation’s transition into a regulated global trade infrastructure provider.

• Joint Response: The IOTA Foundation, together with the SUI Foundation, the Cardano Foundation and the Avalanche Policy Coalition, provided a formal response to the FCA regarding crypto-asset staking and decentralised finance regulation in the UK.
• IOTA Sustainability Portal: The Foundation published the IOTA sustainability portal to display the energy consumption and sustainability indicators of the IOTA network, including the electricity usage and emissions per transaction. 
• Joining forces with Stand with Crypto: The IOTA Foundation became an official partner of Stand with Crypto EU to support policy engagement and to provide real-world examples of blockchain infrastructure, such as TWIN. 
• Taxation and DeFi: The Foundation provided detailed feedback on the implementation of the OECD’s crypto-asset reporting framework (CARF) in jurisdictions around the world, including the EU and Hong Kong.
• EU’s Market Integration Package: The Foundation provided input to the European Commission’s Call for Feedback on the proposal for a regulation aimed at fostering EU market integration and more efficient supervision, supporting stronger capital market integration and highlighting the need to remove regulatory barriers to the use of DLT in financial markets.

Conclusion and Strategic Outlook

Q1 2026 is more than just the start of a new year for the IOTA Foundation. Across every department, the work in this quarter is driven by a single purpose: building TWIN into the world’s trusted digital infrastructure for global trade. From protocol breakthroughs like Starfish and Account Abstraction, to real-world deployments in Kenya and the UK, to growing institutional interest from major financial hubs, the vision of the IOTA Foundation is taking major strides forward. 

As outlined in the IOTA Manifesto, we’re committed to building neutral, open, and scalable infrastructure that makes global commerce faster, cheaper, and more accessible for every nation, business, and financial institution. The coming quarters will see us go deeper, move faster, and focus our team’s strengths entirely on making TWIN a global success: one that sustains the Foundation’s mission and delivers real-world blockchain adoption on a  global scale.

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