IOTA is a new decentralized technology that could be the focal point for the Internet of Things (IOT). By using a new protocol called Tangle instead of blockchain, IOTA offers a decentralized network where information and value can be exchanged between systems without transaction costs.
The IOTA technology is unique and therefore difficult to understand thanks to the Tangle protocol. If you want to delve into the possibilities of IOTA, it is useful if you already have knowledge of blockchain technology. Is not that the case yet? Then we recommend reading our introduction in cryptocurrency .
IOTA is a cryptocurrency which is built on the Tangle protocol and can be used for the IoT ecosystem. The technology is designed to create a safe and decentralized financial ecosystem for the Internet of Things.
IoT, or the Internet of Things, refers to a situation that arises when all kinds of devices have a network connection (internet) so that these devices can exchange data. As an example you can think of a refrigerator that automatically orders milk when the stock is running out, but in practice there will be many applications for IoT.
IOTA is a technology that can help to verify that information exchanged between devices is always correct and can not be manipulated. This mainly concerns the execution of financial transactions. After all, to come back to the earlier example, when a refrigerator orders a packet of milk, it is important to ensure that the payment is actually executed and ends up at the right party. In addition to data integrity, costs, scalability, safety and availability are also important factors for the success of an IoT network. IOTA can meet all these important criteria thanks to Tangle.
The blockchain protocol has the property that there is no central authority and that recorded data is indelible. At the same time, the capacity of a blockchain is usually limited, because once in a while a block has to be mined and a limited number of transactions fit into one block. The miner receives a fee for verifying and / or mincing a block. Without this compensation the transactions would not be confirmed and therefore not added to the blockchain. In a blockchain a lesser fee is therefore essential, as a result of which nano and micro payments are not always profitable. This is not the case in the Tangle, the biggest innovation behind IOTA.
Illustration of the IOTA Tangle
The Tangle knows no mining, no blocks no difficulty and no transaction costs. The Tangle is the IOTA pseudonym for a Directed Acyclic Graph: a cryptographic decentralized network that is infinitely scalable and uses a different form of encryption (hash-based signatures), making it resistant to attacks from quantum computers. Fixing an IOTA transaction does not require a lot of computing power thanks to the Tangle, making it possible on all modern computers and smartphones. All devices with which an IOTA payment is made are automatically a node (part) of the IOTA Tangle. For every transaction that a node sends, the node 2 must confirm other transactions. This way there is always twice as much capacity available as needed to confirm all transactions at that time, and the network becomes faster as more transactions are executed.
IOTA is a new technology that can be used at the moment, but in principle still in the initial phase. There are still many new developments in the planning of the IOTA foundation which ultimately make the technology a great success. One thing is certain: a payment system without transaction costs is something that many organizations will be interested in.
The concept of IOTA is well thought through, however the rollout on a large scale as well as the adoption of the technology still have to take place. There is already a user-friendly IOTA wallet, but there are still few exchanges or other places where you can invest in IOTA. Selling or buying the digital currency IOT / MIOTA is therefore not easy.
In 2017, the cryptocurrency reached a position in the top 10 largest cryptocurrencies, based on market capitalization. With a market capitalization of more than 1 billion euros, IOTA certainly has a strong share in the cryptocurrency market. If the developers succeed in increasing the adoption of the technology by making the purchase and use easier, we expect that the IOT / MIOTA cryptocurrency will certainly achieve good results.
Best IOTA wallet
Because it is still a relatively new technology and IOTA is still very conceptual, there are few wallets available to store IOTA.
There are a number of models available such as a full node, light wallet and mobile app. You can find this on the support website: