Cryptocurrency has become a rising trend over the last few years. Bitcoin exchange rates reached over $5000. Ethereum has come to prominence as a platform for blockchain development, and dozens of new cryptocurrencies have launched to varying degrees of success. One of the most exciting of these new technologies is the IOTA cryptocurrency.
IOTA solves many of the cost and scalability problems with Bitcoin and Ethereum. However, it comes with its own challenges, and it has hit a few major roadblocks on the way to implementation. In the future, IOTA hopes to be the infrastructure that powers everyday devices and connects pieces of technology throughout your life to the internet of things (IoT).
What Is the IOTA Cryptocurrency and What Problem Does It Solve?
IOTA stands for Internet of Things Application, and its name is a good place to start the discussion of what the IOTA cryptocurrency does. IOTA is designed to be a ledger for IoT devices to talk to one another.
For example, temperature sensors in your house can communicate with your thermostat to maintain a comfortable climate. Smart smoke alarms can send you a text message to let you know when there’s smoke in your home while you’re away. Road cameras and sensors will enable traffic lights to make smart decisions about coordinating traffic. The implications of IoT are endless.
Right now, IoT devices require access to a coordinating institution, like an internet service provider, to connect the devices. They rely on WiFi, Bluetooth, and similar technologies to communicate. Eventually, the system breaks down when billions of new devices come online, since connectivity is hard to scale.
IOTA seeks to solve that problem through a decentralized ledger of data shared among connected devices. IOTA also uses new cryptographic technology that is more scalable than blockchain-based solutions like Ethereum. While there are still technical challenges to overcome before IOTA’s full implementation, the implications of full scalability for IoT devices is enormous. Devices on IOTA will pay for their transactions using the IOTA cryptocurrency, and the potential of this new technology is driving its price appreciation.
Directed Acyclic Graph: IOTA’s Advantages Over Other Blockchain Technologies
IOTA uses a technology known as Directed Acyclic Graph to verify the transactions and information on its ledger. Since it’s a peer-to-peer network, each computer on the network maintains a copy of the ledger. When you want to submit a transaction to the ledger, you have to first verify two other transactions. IOTA uses a coordinator that only adds transactions to the official ledger once they’ve been verified multiple times across the network.
Unlike BItcoin and Ethereum, IOTA is not a blockchain cryptocurrency. There’s no need to mine blocks or wait hours for your transactions to be verified. IOTA decouples consensus from the block, making it scalable without fees. Bitcoin is currently suffering from this scalability problem as more people use Bitcoin, it takes longer to get transactions approved. IOTA is poised to knock Bitcoin off its throne if Bitcoin can’t find a way to increase its scalability.
IOTA Coin Price: A Brief History of IOTA News
The IOTA cryptocurrency has dramatically increased in value since its release. The IOTA coin price peaked on August 17, 2017 at 1.024 IOTA per USD. However, recently IOTA has faced some challenges that make it seem less secure as an investment, and its coin price has taken a hit.
In the beginning of September, after reaching a market cap of over $2 billion, the IOTA coin price fell in the wake of a new report about its security. Cryptography experts at MIT found that IOTAs source code was unsecure, and the cryptographic hashing algorithm that IOTA used was critically flawed. When the news hit, the IOTA cryptocurrency quickly lost 15% of its value.
As of October 2017, IOTA’s price hovers around half of what it was at its peak. While the team is scrambling to fix the cryptographic issues that MIT exposed, it’s unclear if now is a great time to buy IOTA for cheap, or if the currency will fall apart as the team fails to launch its technology properly. Anyone considering purchasing IOTA would do well to read the company’s most recent updates and any IOTA news they can find in order to determine whether it’s a good option to buy.
How to Buy IOTA Cryptocurrency and Get in on the Ground Floor
For those interested in purchasing IOTA, it can be a tricky process. IOTA isn’t traditionally listed on exchanges like other cryptocurrencies, so you’ll need some technical know how and a little tenacity to install the user interface for IOTA, get involved in the peer-to-peer network, and purchase the coins.
One Reddit user posted an excellent beginner’s guide with all the links and pictures you’ll need to get started. Reddit and the IOTA official forum are the best places to get ongoing support as you try to purchase the IOTA cryptocurrency. They’ll also be great sources of news affecting IOTA’s development over the coming months and years.