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Thus, the act of making a transaction and validating transactions are coupled. In summary the Tangle solves both the scalability and transaction fee issues faced by Bitcoin (And most cryptocurrencies) by requiring the Sender in a transaction to perform a kind of proof of work which approves two transactions. Unlike Bitcoin which uses a blockchain architecture for maintaining it’s ledger, IOTA uses the ‘Tangle’ which is a Directed Acyclic Graph, known as a DAG. The technological breakthrough that makes this possible is The Tangle (which looks something like this). IOTA has 4 HUGE advantages over Blockchain cryptocurrencies in that it is: (Don’t worry, we will return to the internet of things later). But before we get into why the Internet of Things needs IOTA, lets look at what IOTA can offer to the existing cryptocurrency scene. IOTA is a cryptocurrency designed for the Internet of Things. Quantum-immunity: IOTA utilized a newly designed trinary hash function called Curl, which is quantum immune (Winternitz signatures) Getting Started With IOTA As such, IOTA is more decentralized than any Blockchain. Every participant in the network that is making a transaction, actively participates in the consensus. No Transaction Fees: IOTA has no transaction fees.ĭecentralization: IOTA has no miners. Scalability: IOTA can achieve high transaction throughput thanks to parallelized validation of transactions with no limit as to the number of transactions that can be confirmed in a certain interval

IOTA has a range of features that are uniquely enabled due to its architecture: We envision IOTA to be the public, permissionless backbone for the Internet of Things that enables true interoperability between all devices. IOTA is the missing puzzle piece for the Machine Economy to fully emerge and reach its desired potential. This attestation on the validity of two past transactions ensures that the whole network achieves consensus on the current state of approved transactions, and it enables variety of unique features that are only seen in IOTA. What this means is that each participant in the network that wants to make a transaction has to actively participate in the consensus of the network by approving 2 past transactions. As mentioned previously, there are no miners. Blockchain) is how IOTA achieves consensus and how transactions are made. The major difference that is worth mentioning (apart from the DAG vs. Because of this radical new architecture, things in IOTA work quite differently compared to other Blockchains. The Tangle is a new data structure based on a Directed Acyclic Graph.Īs such it has no Blocks, no Chain and also no Miners. IOTA is the next generation and revolutionary new public distributed ledger that utilizes a novel invention, called "Tangle", at its core.