Iota cryptocurrency – An Introduction Guide

Iota cryptocurrency

IoTA cryptocurrency is the modern, smart and reliable digital transaction system. IOT commonly referred to as internet of things s the connection of electronic devices to a single marketplace. Doing so will increase internet’s worth by 267 billion dollars by the end of 2020. IOTA is the future of cryptocurrency due to its smart revolution. The designers and architects have designed a token especially optimized for IoT. This cryptocurrency is believed to be the harbinger of 4th machine revolution. The transactions of services and goods directly made between the machines without the need of a mediator or a third-party.

1.     IOTA vs. Bitcoins

The Bitcoins and other crypto-currencies use a directed flow of transactions in which the next one approved by the proof of work of the previous transaction. As a result of hashing data, the consumers have thus rewarded accordingly. Unlike the Bitcoin in which multiple parties have to compete with each other for approval of consensus, whenever a participant makes a transaction through IoTA cryptocurrency network, he automatically adds to the consensus as well. In this way, the hinderance in startup and entry reduced to as low as possible.

2.     Tangles are better than block chains

Unlike the unidirectional block chains of the bitcoin cryptocurrency in which the workers have to continuously add blocks to keep the chain running in the specific direction, Tangles use a DAG (Directed Acyclic Graph). In this design, one transaction automatically verified after giving the proof of work of previous two transactions. Since the previous two transactions are directly or indirectly related to all the sub-tangles, the cost of the transaction also reduced and lesser time consumed. Moreover, more and more linkages result in stronger scalability for better user reliability.

3.     Consensus verification

IoTA cryptocurrency is free of cost transaction method. Consensus verification is one of the biggest hindrances in the flow of block chains since block chains limit transaction speed and limit as well. But in tangles, the transactions are made within seconds. The Proof of work obtained as approval of last two transactions reduces the transaction time and lowers entry barrier. Moreover, the micropayments also transferred via the tangles.

4.     No transaction fees

Whenever you make a transaction via IoTA cryptocurrency, you automatically contribute to the consensus as well. All of this controlled by a Co-ordinator which monitors that all linkages remain active. One of the drawbacks of IOTA since it is believed to be a centralized system because of this feature. In the centralized system, there are scalability and security issues, and even the slightest vulnerability can cause hackers attack.

5.     Equal say of all users

The addition in the consensus of the tangles equally obtained from all the linked users at all times. The more you hash data in the linkage networks, the more active the network remains, and the more you are rewarded. There can be no further mining of IOTA tokens since all of them used in the tangle linkages.

6.     Advantages

This cryptocurrency is especially advantageous for transfer of data, databases, micropayments and large payments as well within a short period. Despite the coordinator issue, IOTA is very much reliable as the information is continuously processed and scaled. The technology relies upon the advance DAG mechanism which has a highly efficient validation and consensus power. It is a revolutionary and smart peer-to-peer network which is better than the complicated and troublesome blockchain.

IoTA cryptocurrency is a remarkably excellent concept and has the potential of changing the face of cryptocurrency world if it executed in all its glory. There is still a long way to go until that time.

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