IOTA — How bright is the future for IOTA cryptocurrency

What is IOTA?

The main goal of the IOTA project it to create a technology to enable machine-to-machine (m2m) transactions for Internet-of-Things (IoT) applications.

IOTA can allow systems to share information among the IoT devices and anyone who wants to buy it, maintaining the integrity of the data by securing it in a tamper-proof decentralised ledger. And providing a fee-free exchange medium by using the “Tangle”, its own take on the blockchain.

Tangle is based on a mathematical concept called a directed acyclic graph instead of the blockchain that is used by majority of the cryptocurrencies.

Every transaction on the IOTA platform does not require a miner for verification, but when a user issues a transaction, that user also validates two randomly selected previous transactions, each of which refers to two other previous transactions, and so on.

Using tangle, IOTA promises Fee-free transactions which make micro and nano transactions a possibility.

Current problems with the project:

The IOTA system is built on a ternary counting system(-1,0,1), as opposed to the binary system(0,1) that is the native language of computers.

1. IOTA team invented its own hashing algorithm, Curl. Unfortunately, inventing an attack-proof hash function is an overly difficult task. Even Bitcoin and Ethereum rely on hash algorithms discovered by others.

2. Security of the tangle(IOTA network) directly depends on the number of transactions being processed as unlike blockchain-based systems, such as Ethereum and Bitcoin, the difficulty of the proof of work is not adaptive.

3. Although the above problems exists, the team is working hard to address the issues. They have partnered with scientists to improve the system. The Imperial College of London will partner with the IOTA foundation to bring the IOTA protocol closer to real-world adoption.

We at CoinSwitch.co have recently added IOTA. You can now trade IOTA with more than 300+ currencies available at CoinSwitch.

Disclaimer: This article indicates my personal views on the project and should not be considered as an investment advice.