IOTA USER GUIDE
IOTA & the Tangle - The next evolutionary jump in crypto-currency development that "kills" the blockchain
For all of mankinds history, currency has always existed in some form.
This also holds true, as man is now striving towards being joined in this world by his own new creation: intelligent machines.
Even if completely autonomous intelligent machines are not quite here just yet, a precursor to this exciting new development is taking shape and growing into a vast new branch of global industry and commerce:
The Internet of Things (IOT)
The collection of ever more internetworked devices, home appliances, vehicles, sensors, etc. that collect and exchange data across interoperating networks, autonomously handle transactions and augment the human capacity for cybernetic control of the complex systems that run modern civilization.
Of course the autonomous coordination of extremely huge amounts of data and transactions across very large subsets of different device classes requires some new protocol standards to emerge.
IOTA aims to be one of these important emerging IOT standards (for facilitating autonomous transactions). <<
The appearance of Bitcoin in 2009 and with it the introduction of the traditional "Blockchain" concept as an unalterable, globally distributed ledger for transactions was clearly an invention of revolutionary scope & magnitude.
But the "traditional" concept of the blockchain has major drawbacks and inflexibilities, that make any sort of protocol emerging from that concept an unsuitable choice not only for the requirements of the global Internet of Things with its billions of interconnected devices, but also for all other cases of crypto-currency mass adoption.
Major drawbacks of the blockchain concept that are all solved by IOTA/Tangle:
- Centralization of control through miners even in supposedly decentralized crypto-currencies like Bitcoin
- High energy consumption by blockchain miners
- Inability to scale to very high transaction throughput
- Inability to really handle and execute micro-transactions directly on the blockchain
- Necessity for transaction fees and mining (in most cases)
- Transactions take a comparatively long time to execute, because they need to be incorporated into a "mined block" of the blockchain
- Unlimited growth of the data contained within the blockchain
- Vulnerabilities against attacks performed by quantum computers
| If you desire a more in depth look at the drawbacks of Bitcoin and the classic blockchain --> CLICK HERE (LINK ONLY AVAILABLE ON OUR WEBSITE)
To solve the negative issues of the traditional blockchain concept, the Tangle was invented as an alternative by Russian mathematician Dr. Serguei Popov --> Read the IOTA Whitepaper here (LINK ONLY AVAILABLE ON OUR WEBSITE)
The Tangle is not a blockchain - it is a Directed Acyclic Graph (DAG)
While the Tangle is not a blockchain, it still is a decentralized distributed ledger for transactions. All transactions inside the Tangle are connected through so-called "edges", which are validated representations for transactions that have occured across the Tangle.
Every new transaction input must validate at least two previous other transactions (through executing a small computation) to be considered as validated itself.
This means that the Tangle does NOT require any form of mining or transaction fees.
Other major advantages of IOTA/Tangle:
- Very fast execution of transactions inside the Tangle
- (Quasi-) Instantaneous IOTA transactions are made possible by "flash channel" sub protocol
- Transactions are processed in parallel --> Increased network participation leads to reduced transaction times
- Scalable to very high amounts of parallel transactions
- No centralization of the network
- The IOTA Tangle is completely cryptographically secured against attacks by quantum computers through using the so-called "Winternitz One-Time Signature Scheme"
How you can use IOTA
The best option to use IOTA right now is to use the official wallet, that you can find here: http://github.com/iotaledger/wallet/releases
After completing the installation and selecting the creation of a "Light Node", you need to create a 81 letter string of random capital letters (or the number 9) and enter this as your wallet seed. [You need to store this 81 letter seed in a secure place].
IOTA wallet adresses will look familiar to users of other crypto-currencies, as they are just long strings of capital letters (or the number 9).
GG9NPQJEQWMPFNQPQVXSFUKFCQYY9ZINNMKJHGCXNWXMZCOQILNKFBIUE9LG9NYXOOLQSVHAHAJHAZUCLFZUPJLWD (randomized example)
If you want to receive an IOTA transaction, you just go to the "receive" tab in your wallet client and click "Attach to Tangle", until the adress is connected to the Tangle.
Then you can provide this IOTA receiving adress to another party (for example when withdrawing from an exchange like Bitfinex.com)
** For network security reasons it is important, that you do NOT use an IOTA receiving adress more than once
1 IOTA is the fundamental unit of this crypto-currency.**
The smallest denomination unit typically displayed in your IOTA wallet will be 1 Mi (= 1 Mega IOTA = 1 million IOTA)
IOTA unit distinction:
1 i = 1 IOTA
1 Ki = 1 000 IOTA
1 Mi = 1 million IOTA
1 Gi = 1 billion IOTA
1 Ti = 1 trillion IOTA
1 Pi = 1 quadrillion IOTA
Total (fixed) supply of IOTA in existence = 2.779.530.283.277.761
| Very soon, new wallet clients with better UI design and improved user experience will become available, such as the UCL wallet designed by University College London or the CarrIOTA finance manager client.
| We will update this section, when these new wallet clients become available.
How to stay up-to-date with IOTA development
How you can acquire IOTA
As of yet, the options for acquiring IOTA are rather limited and require the availability of acquiring Bitcoin/Ethereum/Litecoin beforehand, as there is no direct gateway to exchange EUR/USD/GBP/CHF into IOTA.
Best options to invest in IOTA for Europeans:
Acquire ETH/LTC/BTC through Bitstamp.com (SEPA is possible there) and fund account at Bitfinex.com to exchange into IOTA
Acquire ETH/LTC/BTC through SEPA transfer to Coinbase.com or GDAX.com (same parent company) and fund account at Bitfinex.com or Binance.com to exchange into IOTA
Current list of exchanges that allow trading of IOTA (NOV 2017):
- Bitfinex.com
- Binance.com
- Okcoin.com (China)
- YDX IOTAexchange.com (very complicated to use)
Lot's of information. Interesting guide. Don't really care too much for IOTA myself though.
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