IOTAs multi-asset multiverse is coming! Huge implications for its tokenomics

Have you ever wondered what the actual use of the IOTA token is within a feeless network? Well, you are not alone. One of the most frequent questions regarding the IOTA protocol always was how adoption by governments and industry will translate into demand for IOTA token and therefore into rising prices. And even though good arguments could be made that IOTA tokens would have been used for smart contracts and payments, the now released update plans lift IOTA tokenomics to a completely different level.

The IOTA Foundations plans two distinct updates:

1. Tokenization framework will introduce a multitude of new functionalities

2. Dust protection will tie almost every use of the IOTA network to the IOTA token — while still remaining feeless.

Let´s start with IOTAs new functionalities

SimpleOutputs

OK this one is actually not new, but let´s have a quick look at it in order to later understand how dust protection improves IOTA tokenomics. A SimpleOutput is a “normal token transaction”. More precicely, it is an unspend transaction output (UTXO), that holds IOTA tokens.

ExtendedOutputs: