Time to start looking into new goodies on the market! I figured I might as well start keeping my research organized on Steemit so here we go with the first of my new series: Crypto Keeper Studies. Here we go, IOTA
Firstly, I am a bit of marketing sucker. I usually only get interested into unknown coins by their ability to reel me in with marketing. Is the website nice? Does the logo look R-tard? Is there a lot of social media buzz around it?
And then I get into the important things:
- Is this coin solving a problem?
- Who is going to benefit from its existence?
- What does the dev team look like? I mean - what are their creds?
- Is any other coin doing whatever it is they're claiming they're doing to change the world?
IOTA - The Backbone of IoT
Well IOTA is interesting in so much as they're a blockchainless approach. What they are using something called tangle, which is a graph (tangle) that consists of sites -transactions represented on the tangle; and nodes, which issue the transactions. This system wants to eliminate all fees for transactions on the IoT (the Internet-of-Things). So moving 5 unit of IOT, would result in a deposit of 5 IOT. This eliminates the incentive to let the blockchain's creators get their fees (which is basically why dev teams create currencies). But wait a minute...
Let us stress that all the tokens were created in the genesis (no other tokens will be created), and there [is?] no mining in the sense “miners receive monetary rewards”.
So wait, what? These are premined? And there won't be any more...?
How do this system work with transaction approval/mining?
Well, their nodes do the work of approving the transactions with their nifty system, which you can read more about in their whitepaper so I won't go into that details, but it should be noted that the nodes function in an asynchronous way, so teeeeeechnically, this kills the bottlenecks.
To me, this sounds liek the advent of things like RxJS arriving into the world of JavaScript. Except this syetm does not operate even a little bit on JavaScript unlike Ethereum. It is doing away with silly things that will be obsolete like HTTP, DNS, XML. this is where my brain sort of stops understanding because no-JS approach so i don't even wanna think about it.
But nonetheless, they go in-depth, by listing a few attack scenarios, and the efficiency of their network in those cases. They even get into the future of blockchain when it comes to the super computers. They will come, and they will try and decipher blockchain and you can bet someone is going to try it as soon as they can, making all our transactions extremely vulnerable.
IOTA promises resistance to quantum computations
So far, it doesn't look like the blockchain is doing anything to prepare for the rise of super computers that will have massive hashing power, like we've never seen before... so something's gotta give?
As of today, in average one must check around 2-power-68 nonces to find a suitable hash that allows to generate a block.
In iota, the number of nonces that one needs to check in order to find a suitable hash for issuing a transaction is not so huge, it is only around 3-power-8.
Well, IOTA claims their system is better built to avoid a super computer deciphering the transaction since the nonce takes ziiiiip-time to be generated - in fact, as long as every other action on the tangle, making it less vulnerable to a super computer.
At least that's what I understand of the whitepaper. It has a lot of formulas and math and shit I learned programming to never have to do.
So we still haven't talked about the (pre)mining...
Well, there isn't any more mining that's going to happen. That's the whole point of IOTA. Their incentive is the fee-free approach. They're just hoping everyone jumps on this? But this begs the inevitable question: what's in it for them?
So how is it valuable?
Apparently, no one knows yet. Like, I'm not joking, no one seems to know. It says it will be just like cryptos, except it will be fast and free.
So while bitcoin is the gatekeeper of cryptos, Ethereum its super computer, and Ripple helps banks make transactions, IOTA believes it will provide the world's devices with the ability to collectively super compute transactions.
So mining in this case, is useless. But we also have these features to take into account:
- unlimited scalability due to the Tangle
- unlimited data growth
- no forks
I'm not go as far as saying this is un-attackable, but it seems a lot of people believe this.
So what's my verdict?
This isn't a currency, it's a new protocol to move currencies, as I see it. It's what Ripple is to banks, but for crypto! Sounds like I will be investing in this.
Now, time to do some hard thinking about how I am going to approach the next episode: dealing with the (still) bleeding market.
Use my Genesis Mining code to get more hashing power: 61Qx0o