IOTA. Review. August - 2018
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Here on our Cryptoindex blog, we will be posting 100 articles about each of the top performing coins selected by our powerful AI algorithm#CIX100coinreview.
Today’s review: IOTA.
IOTA was presented in the world of cryptocurrency in 2015. The project was announced by David Sønstebø, Sergey Ivancheglo, Dominic Shiener and the doctor of philosophy on mathematician Sergey Popov.
IOTA - it`s a project aimed at developing the technology of blockchain in Internet of Things. This technology has a huge potential of scalability in the IOTA network (MIOTA), transactions are free, and depends not on their size. Mining is completely absent in the project, but the developers found an excellent substitute and offered for users the possibility the transactions themselves. For example, to perform transactions in Bitcoin, you should send a request to the miner who confirms the request using his system resources. To conduct a transaction, you need to confirm two operations from other users of the tangle (Tangle).
This solution allows you to reduce the load on the network, increase its throughput.
In order to increase the security of the network, IOTA added a Coordinator (interacting with complete nodes for additional protection against attacks on a weak network). Its essence lies in the fact that it confirms all transactions included in the package entrusted to it. In the early stages, the network was considered insufficiently secure, with the Coordinator this problem was solved. According to the development team, in future the Coordinator may be removed from the system when it becomes larger. By this move, developers want to secure the system as much as possible.
IOTA uses cryptographic signatures, which are using Winternitz hashing, instead of elliptic curve cryptography, ECC. This helps to increase the hashing speed several times.
Developers also created their own hash function "Curl", but in July 2017, users discovered a vulnerability that allows forging the signature and the management decided to replace it with SHA-3, called "Kerl", it helped to fix this problem.
Since the seed phrase consists of 81 characters, many users were too lazy to save it, so many resorted to third-party services for storing secret phrases. As a result, at the end of January 2018, hacking occurred, hackers stole coins worth $ 4 million. On the same day, hackers attacked the full nodes of the network and users could not return their funds.
IOTA Foundation
The fund registered in Germany is a non-commercial organization aimed at strengthening IOTA, developing its ecosystem and accelerating the development of IOTA as an open source technology.
This foundation was the first non-commercial foundation in Germany, based entirely on funds cryptocurrency. The fund has a competent distribution of management: the Board of Directors, the Supervisory Board, the Advisory Board.
Partnership
In August 2017, IOTA has teamed up with REFUNITE, One of the largest databases on missing people, to use IOTA technology to reunite with the family.
After, IOTA received an invitation from the Metropolitan of Tokyo to participate in the development of Blockchain Business Camp Tokyo. Next, an offer was from the Netherlands. IOTA got an invitation again, to create a test program designed to enable residents to verify the authenticity of government documents without the need to visit relevant institutions. The main launch of the program is scheduled for 2018.
Advantages of IOTA (MIOTA)
- The network is absolutely decentralized.
- The absence of mining, miners will not be able to pool. This helps to reduce the possibility of hacker attacks on the network.
- The complete absence of commissions for the conduct of transactions - to make transactions in the IOTA, to help other parties and, again, there is no need for an intermediary, which according to the scheme of blockchain are miners.
- Greater scalability. As opposed to Ethereum and Bitcoin, in the IOTA network, more users are helping to maintain it. With the growing number of users, in the future, the Coordinator will most likely be removed because its introduction was associated with a small number of network users.
- The ability to work offline, there is no need to be constantly online. On infected computers, this is especially important.
- Micro-transactions allow for small amounts
work in offline mode - the owners of cryptocurrency do not need to constantly be connected to the network since the very concept of this system implies synchronization with the global network;
Further perspectives
IOTA project is one of the long-term projects, on a par with Cardano. Of course, the project has no analogs, but in the near future, they may appear.
For the growth of the network, more users are needed than the network currently has. To this end, IOTA has a special department called IOTA-Core, whose tasks include cooperation with partners and interaction with users of the platform. According to the project Roadmap, in the future special microprocessors will be launched to implement the IOTA network in different systems.
At the time of writing, IOTA [MIOTA] is 1.113% of the total of the CryptoIndex portfolio.
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