In this IOTA Review, we will try to understand as much as we can about IOTA and how useful it can be. We all know that cryptocurrencies are growing very fast – so fast, in fact, that we are witnessing the inception of a new cryptocurrency practically every day. Most of the cryptos in the current market are dependent on the blockchain technology. However, to date, IOTA is the only crypto that is not dependent on blockchain, which means it has taken a step ahead of the existing blockchain technologies.
IOTA – The Main Purpose
In this section of our IOTA Review, let’s talk briefly about IOTA’s special features and why it is different from other cryptos. One of the most appealing features of IOTA is that there are no transaction fees involved when transferring funds. This is because it doesn’t require miners to process the transaction. However, some computational power is required to submit a transaction. Most people believe that IOTA is capable of addressing the problems in transfer speeds being faced by blockchain-based currencies such as Bitcoin and Ethereum.
In blockchain-based cryptocurrencies, as the block gets lengthy, the transaction speed gets reduced. If the block grows to a certain length, the transaction tends to become more expensive and the restrictions more complicated. Yet another drawback of blockchain-based currencies is that the length of the blockchain increases continuously, resulting in great difficulty for computers to mine their currencies,. Today, both BTC (Bitcoin) and ETH (Ethereum) are 150 GB long and are still growing. Assuming their size increases ten-fold in the next couple of years – how many computers in the world will be able to mine their currency? Almost none. IOTA, with its new technology, is highly capable of addressing such issues.
Tangle – IOTA’s Latest Crypto Technology
Continuing our IOTA Review, we will discuss the latest technology being used by IOTA, known as ‘Tangle,’ in transferring funds. It is this technology that allows IOTA to transfer funds free of cost and at great speeds. Making use of ‘Directed Acyclic Graphs (DAG)’ to store various transactions, Tangle has eliminated the role of miners in processing funds, thus decreasing the transfer time considerably. In blockchain technology, though the network keeps growing, the number of transactions completed per second remains stable, meaning that growth causes a negative impact by slowing down transaction speeds. This is the reason why the average transaction fee for a fund transfer in BTC is as high as $25 USD.
With IOTA, however, the transfer speed increases as the network grows. This is because every user who wants to perform a transaction has to verify at least two other transactions. As multiple users continue verifying transactions and giving their approval, the security and accuracy of transactions continue to increase, allowing them to be processed faster. Another interesting feature of IOTA is that it does not determine the time it will take to perform a particular transaction, resulting in some transactions being approved faster than others. This is because the system picks two transactions randomly for every user to verify, and the transactions that get the maximum number of user approvals will be processed first. This implies that as the number of transactions being performed increases, the number of transactions being verified by the users increases along with it, subsequently decreasing the time required to process transactions.
IOTA – What’s In Store For The Future?
Since IOTA is yet in its infant stage, it is difficult to analyze it in detail. However, one can call this as an incredibly interesting and ambitious project that has the potential of re-writing the story of cryptocurrency. If this new technology becomes successful, it will be the first of its kind to not only overtake BTC, but to also render it inferior. Though therea are doubts about the feasibility of its technology and absence of an open source coordinator, IOTA is still considered as a currency with huge potential. With a market cap of $11B USD and the 7th position in the cryptocurrency rankings, IOTA has already started to prove that it is here to stay!