IOTA and “tangle” explained in a nutshell
Although IOTA (Internet of Things Application) was first announced somewhere in 2015, the world’s top 13th cryptocurrency started getting really famous in 2017. IOTA was listed on big exchanges including Bitfinex during June of 2017. One of the leading reasons for IOTA’s popularity is because not only does it offer fast transactions but it has absolutely no fees. Literally, the fee is $0, that is something which attracted a lot of investors.
Another reason IOTA became famous is due to it being Quantum Computing proof or future proof. One very significant thing about IOTA is that technically it doesn’t use the blockchain technology. Yes, it will take some time to sink in. If you aren’t aware, almost all cryptocurrencies including Bitcoin and Etherum, use the blockchain technology.
Instead of using the blockchain technology the cryptocurrency with a market cap of well over $1.2 billion uses a technology known as “Tangle.” The easiest way to understand tangle is by using an example. If you go down the memory lane, back in school teachers often use to ask you to grade your friend’s assignment and vice versa.
Tangle works in a very similar way so everytime you send a transaction, and you also verify roughly two transactions which are in line for approval from your account. To an extent, this is a very smart way of verifying transactions. If we go back to our example, you probably also remember that a majority of the time the teachers used to grade your assignment.
An official blog by IOTA explains tangle stating; “The implication is that, without miners, the system needs to be collaborative: the users would have to help themselves by vetting each other’s transactions.”
Well, in the case of Bitcoin and other blockchain backed cryptocurrencies that’s the case. A lot of computer power is needed to verify the transactions, and that is where proof of work (POW) comes into action. Basically, users set up a mining machine and then mine cryptocurrencies, and in return, they are rewarded through a small amount of Bitcoin or other Altcoins.
These machines are not only expensive but also consume a lot of power and aren’t good news for the environment. Investors often compare IOTA to Ripple’s XRP. However, XRP has a very small transaction fee in order to avoid spam. In IOTA’s case, there is no fee because users are cross-checking or verifying each other’s transactions.
IOTA (MIOTA) Price Today – MIOTA / USD
IOTA being utilized by over 600 companies
In a recent conference, one of IOTA’s executive said that over 600 firms have been interested in using IOTA.
He stated “Right now you could get a very good deal for just knowing IOTA and basic programming. A lot of these pending projects simply lack people who know the basics of programming and IOTA.”
He added, “It is the Tinder for companies that want to collaborate on using IOTA.”
The executive also seems to think that after one last enhancement in the coin, IOTA’s adoption rate would skyrocket. And that it would be adopted at a rate which will set a new record in world’s history. Tangle is an ingenious way of verifying transactions, but if copied by other new cryptocurrencies, IOTA might be at risk.
Right now might be a good time to invest in IOTA because it is at its low due to the bearish crypto market. If Bitcoin rises during early 2019 as expected then IOTA’s price will undoubtedly skyrocket and investors who invested money this year would make a tremendous amount of money.
This isn’t financial advice, and you shouldn’t invest your entire life savings in the volatile crypto market instead only invest money you are comfortable losing.