Iota was released in 2015 and is built on the idea of secure communication between machines. Iota is built on an open source as well as a decentralized platform. IOTA is in fact, an abbreviation that stands for Internet of Things Application. As the name suggests, this cryptocurrency is designed for machine-to-machine communication in an Internet of Things (IoT) environment.
The smallest unit of this currency is an Iota, which is derived from the Greek letter iota (i). A thousand Iotas make a kiloiota and a thousand kiloiotas make a megaiota or miota, as it is commonly known. The supply of Iota was kept fixed at 2,779,530,283,277,761 Iota, or 2.7 PetaIota (or Piota). This implies that there are no more Iotas that can be made. In fact, there is no concept of mining in this cryptocurrency.
Iota operates on a technology that is different than the popular blockchain technology that is used for bitcoin and many other cryptocurrencies. Iota operates on a technology called tangle, which is more technical terms, is also referred to as Directed Acyclic Graph (DAG). In tangle, for any transaction to be successfully verified, a user must validate any two other randomly selected transactions. Thus, when a transaction is successfully validated a certain threshold number of times, it can be verified by the recipient of a transaction. Thus, the more the number of users using Iota and validating a transaction, the faster the Iota network works to verify the transactions. Additionally, because the users themselves verify the transactions, it eliminates the need for any third-party to do so, thereby, making the transactions free. For the same reason, there is no requirement for miners.
Iota is listed on the cryptocurrency exchanges such as Bitfinex and Binance. However, Iota cannot be bought simply by paying with fiat currencies such as the dollar, euro or rupee. Iota can only be exchanged with another cryptocurrency such as a bitcoin or an ethereum. Thus, if a layman user intends to buy Iota, he or she would need to first purchase another cryptocurrency and then, exchange it with Iota at one of the cryptocurrency exchanges that Iota trades in.
In merely 3 years, Iota has shown substantial progress with it trading over a market cap of 16 billion dollars. In the past one month alone, Iota has shown a 600% increase in its price from its initial price of 0.37 US dollars. Presently, Iota is trading at a price of approximately 5 US dollars. Although the price per unit seems quite low in comparison to bitcoin, the market cap of Iota is among the top 5 cryptocurrencies having the highest market cap.
Iota’s success is also evident from the fact many big companies such as Samsung, Fujitsu, and Microsoft have participated in initiatives for creating a data marketplace for IoT use cases using tangle. This could potentially result in massive machine-to-machine based applications that allow machines to interact with each other without the need for human intervention. For example, a user’s mobile phone can interact with a payment gateway to automatically pay the user’s phone bill in Iotas. In another scenario, a user’s credit card may interact with a merchant’s PoS terminal to pay the user’s coffee bill.
The possibilities seem to be endless and Iota seems like a strong leap forward to realize them through an IOT framework.