Cryptocurrency IOTA Simplified! Everything To Know About IOTA

Cryptocurrency IOTA Simplified! Everything To Know About IOTA

Education
November 4, 2017 Blockchain Magazine
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Features of IOTA: Developed for IoT devices Doesn’t use conventional blockchain technology No miners The speed of the platform increases with the number of users IOTA, founded in 2015, is a cryptocurrency aimed at implementing secure payments and communication between the Internet of Things. The transactions of IOTA are free whatever the size may be
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Features of IOTA:

  • Developed for IoT devices
  • Doesn’t use conventional blockchain technology
  • No miners
  • The speed of the platform increases with the number of users

IOTA, founded in 2015, is a cryptocurrency aimed at implementing secure payments and communication between the Internet of Things. The transactions of IOTA are free whatever the size may be and have faster confirmation times.

Another remarkable feature is the unlimited simultaneous transactions. It also has collaboration with Telekom, Fujitsu, Microsoft and Deutsche.

The Blockchain-less Design

IOTA uses the DAG (Directed Acyclic Graph) technology rather than the popular blockchain. IOTA’s DAG is also known as Tangle which is a generalization of the familiar blockchain protocol.  Hence IOTA is a cryptocurrency without a blockchain!

For a transaction to be valid, the payee should approve two of the previous transactions at the other node. Hence it removes ‘miners’ as entities and the network’s growth and speed becomes proportional to its number of users. It does not charge any transaction fees and also claims to have solved the scaling problems related to bitcoin.

The IoT market is expected to have a worth of $470 billion by the year of 2020. The nonprofit organization has already partnered with a number of companies which will play a prominent part in IoT, like the Samsung Electronics Ltd. (SSNLF), Cisco Systems Inc. (CSCO) and Innogy, to build a data marketplace which can be monetized afterward.

New Cryptography Algorithms for a Future-Proof Design

IOTA makes use of the signatures of Winternitz hash based cryptography rather than the ECC (Elliptic Curve Cryptography). The hash-based signatures are found to be much faster than the ECC.

In IOTA a self-carved hash function called CURL was used which was then replaced by a version of SHA-3 called KERL. Instead of binary operations, KERL works on ternary operations, effectively fixing some of the problems encountered before.

The official wallet of IOTA is the version 2.5.6, which can be downloaded from GitHub. For the current wallet, you will need to independently generate your own private key (seed).

The IOTA use has been widespread across the globe because of its applicability and future-oriented development. Some experts believe that IOTA solves major problems which current blockchain is facing hence has a potential to become one of the widespread currency in future.

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