In 2015, the IOTA project was launched with a vision of creating a distributed ledger for the Internet of things (IoT). Initially, the project had unusual design architecture but it was rewritten later on to embrace established standards. In 2019, the theoretical foundation of a feeless, fully decentralized and secure IOTA protocol was launched and it was known as IOTA 2.0. The IOTA project, named after the smallest letter of the Greek alphabet, was funded initially by an online crowd sale and it created amazing vibes due to its novel concept of distributed ledger technology (DLT). IOTA doesn’t have proof-of-work or proof-of-stake consensus. The distributed ledger architecture of IOTA is quite unique as it uses DAG or Directed Acyclic Graph. The network has been targeted by quite a few attacks and vulnerability was detected. In 2020, the Trinity wallet was hacked. The network went completely offline as the IOTA Foundation had to shut down the ‘coordinator’ node responsible for approving any IOTA transaction. This incident raised serious questions about IOTA’s decentralization. IOTA Foundation has recently launched IOTA 2.0 DEVNET and it is a prototype for bringing complete decentralization.
“Today we launch the IOTA 2.0 DevNet, the first fully decentralized IOTA network without the need of a Coordinator, together with our new Digital Assets framework. We invite everyone (and every machine) to join this network, to learn, and to experience the future of IOTA today.” – IOTA blog post on 2nd June 2021
IOTA 2.0 protocol was launched with a vision of creating an open, equitable and fair distributed ledger network. The low resource requirement was purposefully made to fit the Internet of Things. It was designed to be a leaderless consensus protocol where every participant was supposed to have the same right. Conversion of a theoretical foundation into reality is a cumbersome task. After years of developmental work, finally, the DevNet is open for testing and aims to become production-ready and aligned to the original vision of most decentralized distributed ledger networks possible.
Feeless: all transactions are absolutely feeless.
Security: Double-spending isn’t possible. The network is spam-proof and the attacks aren’t possible.
Decentralization: There is no need to elect a leader. The consensus is achieved by the democratic participation of all nodes.
Image Source - Removal of ‘coordinator’
The new IOTA testnet has no ‘coordinator’, message structure and it has a new consensus mechanism. The team claims that this is the most powerful implementation of a feeless Distributed Ledger protocol based on a directed acyclic graph (DAG). The network is capable of hosting smart contracts, any complex DeFi platform and even layer 2 protocols. IOTA was always a fast ledger but this testnet offers transaction finality in seconds. The super-fast finality is achieved through Mana based approval weight. Running a node with low power devices has remained a problem with many blockchains. IOTA 2.0 allows low power devices to run a node easily as message creation and validation are inexpensive operations on IOTA. If you’re enthusiastic about trying and testing new things related to blockchain technology, you can try to run IOTA 2.0 Devnet node and the tutorial is available here.
IOTA 2.0 Devnet has created enthusiasm in the community. The testnet will go through various phases before the launch of mainnet 2.0. The team also plans to launch incentives for the network participants. IOTA wanted to address the key issue of blockchain scalability through an alternative approach and that’s why the growth of the project had remained slow. The decision of being quantum-proof became a boomerang for them due to various flaws in the technique. After a lot of mistakes, the project is trying to adopt a new approach after acknowledging the issues. A production-ready distributed ledger that doesn’t need miners, electricity, transaction fees and usable by humans and machines can find excellent use cases in the real world if properly implemented. The IOTA Foundation has wasted enough time to optimize the trade-offs between centralization and decentralization. This time, they want to embrace the completely permissionless path. Yes, that’s the preferred way ahead.
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