What is IOTA?
IOTA (Internet of things application) is an open source and decentralized cryptocurrency that offers private transactions. Every IOTA payment is published on a public blockchain, but information about the amount, the sender and the receiver of the transaction is kept secret.
The ledger based technology used by IOTA addresses the issues of transaction fees and scalability that blockchain technology does not. Once you submit a transaction to the IOTA ledger, you verify two previous transactions.
IOTA’s developers developed this system with the aim of seeing the machines trade with each service and resources such as bandwidth, electricity, and storage while using IOTA as their mode of payment.
How does IOTA work?
IOTA does not use the blockchain technology. It uses the tangle technology. The tangle technology allows settling the transactions without a fee. Mostly, it is a blockchain with neither the blocks nor the chains. Tangle ledger also helps in achieving data transmission and integrity. Hence, there is no need for miners.
The IOTA system is designed in such a way that it maintains the privacy of the transactions. The public can not view the transactions. They are also not traceable since it conceals all the transactions. Therefore, your identity is kept private, and no transaction can be traced back to you.
Who created IOTA Blockchain?
IOTA was founded in the year 2015 by David Sonstebo, Sergey Ivancheglo, Dominik Schiener, and Serguei Popov. Its headquarters is located in Berlin and operated by the IOTA foundation which is the corporation that funds the development of IOTA. The main objective of the organization is to create a sustainable IOTA ecosystem that will accelerate its commercial adoption and development as an open source technology.
IOTA is a platform with MIOTA as a cryptocurrency. It is based on Direct Acrylic Graph (DAG) technology known as Tangle.
Tangle validates node transactions without a blockchain through consensus finding. IOTA does not use blockchain technology. Each node operates freely to choose selection algorithm.
How is IOTA different from other cryptocurrencies?
In IOTA, there is no separate mining unlike in Bitcoin. Once you initiate a transaction, you validate two transactions. Therefore, you speed the network by taking part in it. Each individual is considered an independent miner. Hence, IOTA allows a decentralized protocol development
There are no transaction fees in IOTA. The minimum amount of IOTA you can send is 1. However, the amount of BTC that you can send can be less than 1.
In Bitcoin blockchain, transactions must be transmitted by nodes that are connected to the network. In IOTA, however, the nodes can operate appropriately without being attached to the central tangle. The can connect to the network quickly when the internet connection is available.
How do I store IOTA? What is the best IOTA wallet?
Altcoins are stored in a wallet system. Each digital wallet has a unique receiving address. Anytime you want to receive coins, issue your address to the sender. Once sent, the coins will appear in your wallet.
There are various wallets available for storing IOTA. These are:
- Hot Wallet
This wallet is directly connected to the internet. It allows a smooth process of sending funds. However, it is not very secure hence not safe to keep funds in it.
- Cold Wallet
This wallet does not need an active internet connection. It is a wallet generated by the computer using an air gap.
Where can I buy IOTA?
IOTA is sold on various platforms known as exchanges. Most exchanges require you to create an account with them if you do not have one for you to be able to trade IOTA. Some of the top exchanges where you can buy IOTA are
- Bitfinex (BFX)
It is a cryptocurrency exchange platform based in Hong Kong. It allows you to buy IOTA using USD, Ether or BTC
It was the first platform to offer to the trade of IOTA and is based in China. On this platform, you can buy and sell IOTA as well as other cryptocurrencies. The channels here are safe and offer a convenient service to the traders.
If you want to purchase IOTA, you need to own Bitcoins or Ethereum already. If you do not have BTC or ETH, you have to buy first then trade them for IOTA.
Can IOTA be mined? How to mine IOTA?
You cannot mine IOTA. This is because all available IOTA was created at the beginning. IOTA technology facilitates transactions between the devices on the IoT (Internet of Things). Therefore, there is no central ledger hence no need for miners to power the IOTA network.