“Secure, efficient, lightweight, real-time micro-transactions without fees”- David Onstebo, Founder of IOTA.
IOTA’s primary goal is to become the go-to platform for executing transactions between Internet of Things (IoT) devices.
Internet of Things (IOT): a system of devices, machines, objects, tools, or people that have unique identifiers (UIDs) and possess the ability to transfer data over a network without requiring human intervention. Essentially, things that can connect to the internet and other things by themselves.
The use cases don’t end there. IOTA believe their distributed ledger could deliver digital identities to all, meaning we could get things like health insurance policies that are based on actual health conditions. This could pave the way for cutting-edge smart cities, deliver seamless global trade, and verify the authenticity of products.
IOTA is already heavily entrenched in the automotive industry, the energy economy, supply chain management, and governance through digital identities.
How is IOTA attempting to do this?
Well, IOTA is a blockchain-less blockchain. What does this mean? Well, in a typical blockchain, each block contains data, and the chain means each block added to the chain must have one block before it and one after it.
IOTA is similar to blockchain, but it’s not the same. IOTA uses something called a ‘directed acyclic graph’ (DAG). Think of a bunch of computers that communicate back and forth with one another about transactions they have had with nearby computers. Using this back and forth chatter they agree on what the ledger (documented history of transactions) is and what data should be stored on it. Instead of a chain, think of a web. IOTAs technology that functions in this way is called ‘Tangle’.
Tangle: a system of nodes that confirms transactions.
For more projects that use a DAG instead of a blockchain, read our Simply Explained pieces on Fantom and Hedera.
What makes IOTA so cool?
No blockchain means no miners, and no miners mean no fees. Compare this to the high fees we see on blockchains like Ethereum and Bitcoin. Instead of mining, each transaction confirms two previously unconfirmed transactions.
This low computing power also means IOTA is very green and environmentally friendly.
IOTA also offers blistering speed. The transactions per second for Bitcoin are around 7, and 15 for Ethereum. Compare this to IOTA which has a TPS of 1,000.
IOTA has secured some of the biggest deals in the cryptocurrency space. It has partnered with Jaguar in the automobile industry- drivers can now earn money while driving their cars.
What affects the price of the IOTA token?
As your standard A-level economics textbook will teach you, one of the most important determinants of price is demand.
The Internet of Things (IoT) is still green, however, it’s not difficult to look into its future and see the space grow. More and more machines will have processing power plus the ability to connect to the internet. These machines will interact with other machines which means the expansion of IOTA. When investing in IOTA, one of the core things you’re essentially investing in / betting on is the future of the Internet of Things.
What is the MIOTA token?
IOTA is the network, and MIOTA is the native token used on the network. MIOTA is a utility token that can be used to transact on the network.
MIOTA has a maximum and circulating supply of 2,779,530,283 tokens.
