IOTA has risen to the forefront among cryptocurrencies by distinguishing itself as a non-blockchain cryptocurrency. It operates a ledger in a special category referred to as a directed acyclic graph (DAG), known as the “Tangle.” IOTA aims to provide the basis for the Internet of Things (IOT) given that the system allows transactions without fees and asserts unlimited scalability. Currently, the Tangle requires a central coordinator to validate transactions, though the developers assert that once the network grows big enough, it will truly be decentralized without the need of a coordinator.
Development of IOTA began in early 2015, as the development team sought to product a next-generation distributed ledger. Before founding IOTA, the development team produced Nxt, the first proof-of-stake (POS) cryptocurrency. The developers of IOTA have also set up the non-profit IOTA Foundation, which is based in Germany and houses the development team, in order to promote the Tangle and its implementation in IOT and other use-cases. Outlier Ventures, a venture capital firm, has invested seven figures into the project.
While some skepticism has been expressed regarding the Tangle, major corporations have collaborated or partnered with IOTA, including Microsoft, Bosch, Cisco, and Foxconn. Additionally, IOTA has collaborated with leading universities, such as Imperial College London, University of California at Berkeley, and University College London’s Center for Blockchain Technologies.
IOTA’s vision and its partnerships, along with a thriving community of users and investors, has catapulted the cryptocurrency into the top 10 by market capitalization. While the future remains an open question for IOTA, as it plods its way through the thicket of technological innovation, investors have expressed confidence that the development team is on track to meet its goals. If IOTA succeeds in its ambitions, its market capitalization is sure to rise exponentially from where it is today. Of course, when it comes to technological revolutions, an organization’s standing can be far from certain or assured. Only time will tell where IOTA will stand, and over time this picture is likely to become clearer.