About IOTA (MIOTA)

IOTA Frequently Asked Questions (FAQ)

What is IOTA and how does it differ from traditional blockchain technology?


IOTA is a distributed ledger designed to record and execute transactions between machines in the Internet of Things (IoT) ecosystem. Unlike traditional blockchain technology, which consists of a chain of sequential blocks, IOTA uses a structure called the Tangle, a form of Directed Acyclic Graph (DAG). The Tangle allows for feeless and scalable transactions, with the validation process being intertwined with transaction making, thus eliminating the need for miners and reducing potential bottlenecks associated with blockchain's proof-of-work consensus mechanism.




Can you explain what the Tangle is in the context of IOTA?


The Tangle is IOTA's underlying data structure and network protocol, which enables scalable and fee-less transactions. It contrasts with traditional blockchain models by using a Directed Acyclic Graph (DAG) where each transaction confirms two previous transactions, leading to faster processing times and no need for miners or block rewards.




Are there fees for transactions on the IOTA network?


No, there are no fees for transactions on the IOTA network.




What are the primary goals of the IOTA platform?


The primary goals of the IOTA platform are to enable secure, scalable, and feeless transactions for the Internet of Things (IoT). It aims to facilitate seamless data exchange and value transfer between machines and ecosystems, thereby promoting new business models and the efficient use of resources through machine-to-machine (M2M) interactions.




How does IOTA aim to integrate with the Internet of Things (IoT)?


IOTA aims to integrate with the IoT by providing a scalable and decentralized platform designed for microtransactions between devices. Its Tangle technology offers feeless transactions and low resource requirements, making it suitable for IoT devices to communicate and settle transactions efficiently, securely, and quickly, enabling a machine-to-machine economy.




What potential use cases does the IOTA team envision beyond IoT applications?


Beyond IoT applications, the IOTA team envisions use cases in areas like identity management, supply chain tracking, smart cities, digital assets, energy trading, and mobility. These applications leverage IOTA's unique features like feeless microtransactions and secure data transfer to enable new forms of asset management and value exchange across a variety of industries.




When was IOTA officially launched and what was its original name?


IOTA was officially launched on 11th June 2016. It did not undergo a name change and has been known as IOTA since its inception.




Who are the founders of IOTA and what roles do they currently play?


The founders of IOTA are David Sønstebø, Sergey Ivancheglo, Dominik Schiener, and Dr. Serguei Popov. As of my last update, the roles they play have evolved since inception, and some have even departed the foundation.




What led to one of the IOTA co-founders resigning from the project?


One of the IOTA co-founders resigned from the project due to disagreements with the team over the project's direction and management issues, which resulted in internal conflicts and disputes.




In what ways does IOTA's Tangle enable micro-transactions without fees?


IOTA's Tangle enables micro-transactions without fees by using a unique Directed Acyclic Graph (DAG) structure, whereby users validate two previous transactions to make their own transaction. This eliminates the need for miners or stakers, thereby removing transaction fees and allowing for fee-less micro-transactions as part of the network's design.




What is the Directed Acyclic Graph (DAG) and how is it related to IOTA's Tangle?


A Directed Acyclic Graph (DAG) is a data structure consisting of vertices connected by edges with no cycles, meaning it cannot loop back on itself. In the context of IOTA, the Tangle is a type of DAG where each transaction is a vertex and edges represent approvals of previous transactions. Unlike blockchains that use blocks and a single chain, IOTA's Tangle allows multiple chains of transactions to coexist and interconnect, enhancing scalability and reducing transaction fees and times.




How are transactions validated on the IOTA network?


Transactions on the IOTA network are validated through a unique system called the 'Tangle', which is a Directed Acyclic Graph (DAG). When a new transaction is issued, it must approve two previous transactions. This is done by performing a small amount of proof-of-work which checks the validity of the two transactions. As more transactions are added, they further confirm the previous ones, leading to a network of inter-validated transactions without the need for miners or a blockchain.




Is the IOTA Foundation a for-profit organization?


No, the IOTA Foundation is not a for-profit organization. It is a non-profit organization established in Germany to support and promote the development and adoption of the IOTA platform and related technologies.




What notable partnerships has IOTA formed with other companies or cities?


IOTA has formed notable partnerships with various companies and organizations. Some key collaborations include: partnership with Jaguar Land Rover for an integrated smart wallet technology, collaboration with Bosch for leveraging IOTA's Data Marketplace, and working with the City of Taipei to explore smart city solutions using IOTA's technology. Additionally, it has formed alliances with global corporate entities to explore and implement its distributed ledger technology in different industries.




What is the maximum supply of IOTA (MIOTA) coins and how many are in circulation?


The maximum supply of IOTA (MIOTA) coins is capped at 2,779,530,283 MIOTA. All of these coins are already in circulation, as IOTA had no mining or minting process after its initial coin offering.




What was the purpose of IOTA's crowdsale and how did it impact the token supply?


The purpose of IOTA's crowdsale was to raise funds to develop the IOTA network, which is designed to facilitate transactions and data transfer for the Internet of Things. The impact on the token supply was the initial distribution of the total supply of IOTA tokens. The crowdsale allocated a fixed supply of 2,779,530,283,277,761 IOTA tokens, setting the total supply that will ever be available, as IOTA does not use mining or staking to create new tokens.




How is the IOTA network secured and what consensus mechanism does it use?


The IOTA network is secured through a consensus mechanism known as the Tangle, which is a directed acyclic graph (DAG) for storing transactions. Unlike blockchain tech, IOTA does not use miners; instead, each node making a transaction must confirm two previous transactions. This process of mutual transaction confirmation by participants in the network ensures security and consensus without the need for miners or a traditional blockchain structure.




What security concerns have been raised about IOTA and how has the foundation addressed them?


Concerns about IOTA have centered on vulnerabilities in its early cryptographic functions, potential security issues with the Coordinator, and the risks of addresses being reused after spending from them. The IOTA Foundation addressed these issues by updating their cryptographic algorithms, taking steps to remove the Coordinator in a process called Coordicide to decentralize the network, and implementing the IOTA 2.0 DevNet (Nectar) as part of a move to a fully decentralized network. They also educate users on safe practices like not reusing addresses and have developed tools to prevent such mistakes.