“2017 will be the year where IOTA is truly ‘launched’ and real world adoption via deployments start occurring,” wrote David Sønstebø Founder of IOTA. As soon as IOTA hit the exchanges we’ll change it position from The Fringe. David is not a big fan of speculating on the price so the exchanges are not IOTA’s priority (“real world adoption via deployments” is the real focus) but we need a milestone to follow.
For the first time ever true micro and even nano-transactions are enabled due to the unique IOTA Tangle architecture, providing developers with a brand new set of tools for their applications in both IoT and Web. This nurtures brand new business opportunities for companies that prohibitive fees has kept in the realm of the impossible until now.
If you’d like to get to the roots of IOTA and understand it better start with The tangle by Serguei Popov (white paper for for Jinn Labs, published on December 28, 2015). To wet your appetite, herein a brief excerpt from the seminal white paper:
The rise and success of Bitcoin during the last six years proved the value of blockchain technology. However, this technology also has a number of drawbacks, which prevent it to be used as a one and only global platform for cryptocurrencies. Among these drawbacks, an especially notable one is the impossibility of making micro-payments, which have increased importance for the rapidly developing Internet-of-Things industry. This justify a search for solutions essentially different from the blockchain technology, on which the Bitcoin and many other cryptocurrencies are based. In the present whitepaper we propose a cryptocurrency system called iota, that can be used for creation of world-wide money for Internet-of-Things using existing hardware.
In general, iota works in the following way. As mentioned before, there is no global blockchain; on its place there is a DAG (directed acyclic graph), also called tangle. The transactions issued by nodes constitute the site set of this DAG. Its edge set is obtained in the following way: when a new transaction arrives, it must approve two previous transactions; these approvals are represented by directed edges, as shown on Figure 1 and others (on the pictures, times always goes from left to right). If there is a directed path of length at least two from transaction A to transaction, we say that A indirectly approves B. It is assumed that the nodes check if the approved transactions are not conflicting and do not approve (directly or indirectly) conflicting transactions. The idea is that, as a transaction gets more and more (direct or indirect) approvals, it becomes more accepted by the system; in other words, it becomes more difficult (or even practically impossible) to make the system accept a double-spending transaction.
In the subsequent sections, we discuss algorithms for choosing the two transactions to accept, the rules for measuring the overall transaction’s approval (Section 3 and especially Section 3.1), and possible attack scenarios (Section 4). Also, in the unlikely event that the reader is scared by the formulas, (s)he can jump directly to the conclusions” part in the end of corresponding section. Also, it should be noted that the ideas about usage of DAGs in the cryptocurrency context were around for some time, see e.g. [1, 2, 3, 4]. Especially, observe that in the work [2] a solution similar to ours was proposed.”
The rest, as noted, is in the original white paper, The Tangle.
Disclaimer: we own a modest amount of IOTA tokens and if the IOTA ends up being successful on the markets we would profit. We also really love IOTA and its community we observe from afar.
The approach makes me think of a p2p filesharing algoritm by Stanford which never saw the light, as all p2p technologies were successfully framed as criminal networks. https://nlp.stanford.edu/pubs/eigentrust.pdf
It would be nice if you actually timestamped your articles. Most news articles have a timestamp, for the reason that readers want to know how recent the article is. Without a timestamp, one has to assume the earliest possible date, i.e. sometime in 2016 (or earlier) for this article, which references 2017 in the future tense.
^ Duly noted Oliver, thanks. Will do.
David and his beard keeping that tangle together! A timestamp would definitely be nice, I agree with the other posts. I’m guessing the price of IOTA has risen quite a bit since this article! Cheers.