IOTA offers some distinct features that are not available in many traditional blockchains. Industry experts love to voice their disapproval of this project, but it sure has its silver lining.
IOTA has made it to the list of the leading cryptocurrencies for more than a year. Despite its unique features and possibilities, it somehow still appears like an outsider in the marketplace ranking. However, looking at it from the outside, the value it offers might look so obvious.
These important or perhaps groundbreaking ideas might have been looked over in favor of mass criticism. It’s not uncommon for these things to happen. While we might not like to admit it, popularity drives both technology development and adoption. Many great ideas have been ridiculed at first, only for people to find much later that they weren’t at all a bad idea.
Why is IOTA so unpopular?
We should start here. First of all, IOTA isn’t unpopular just because it is not a blockchain. There are many details in its proposals, implementation, and even PR that genuinely worry the community.
IOTA doesn’t work as a regular cryptocurrency. In fact, as per its design, the only way for anyone to obtain IOTA is to buy it. You can’t mine it, stake it, or otherwise obtain any of it without straight up paying for it. By design, all the IOTA tokens were created at launch, and no more can be created. People, of course, have found ways to “mine” it, but these include third parties.
The reasons why IOTA can be mined also bother part of the community. Instead of relying on free nodes to authenticate transactions, IOTA charges a transfer “fee” in the form of authentication. In other words, in order to be able to make a transaction, you must first help authenticate two.
There are more reasons for its unpopularity. The crypto community is largely made up of open source proponents, with most blockchains being open. IOTA attempts to be open, but it is owned by a company that has previously and occasionally intentionally obfuscates data. This is a no-no in the open source community.
More importantly, there are doubts as to whether IOTA can actually deliver any of its promises. First, because it seems to promise too much. IOTA is sold as having “infinite scalability,” something any developer should be very wary of any day. Nothing is ever infinite and offering it as such from the get-go is a nice way of letting people down.
Another point of contention is IOTA’s achievements and the veracity of these. The IOTA team has repeatedly made statements of doubtful veracity. At times, they have been found allegedly to be complete fabrications. All of these statements, of course, refer to IOTA’s success. In a community like the open source one, where the truth is highly prized, that alone can be destructive.
How looking past the issues might improve IOTA possibilities
Now, we can’t say the issues or worries are at all wrong. Many of the criticisms against IOTA could be very much valid. So is the idea that it goes against the basis of cryptocurrencies.
The thing one might want to consider is that perhaps IOTA doesn’t want to be a cryptocurrency. Or at least not in the way we know and understand it so far. It does away with many of the blockchain standards, because it wasn’t created to uphold them to begin with.
The key to understand here is that IOTA is actually owned by an industry player. It’s not a small startup company, or a group of developers aiming to make the best cryptocurrency. It’s an industry player, trying to make something useful while filling their pockets. The organization take whatever parts of the paradigm that works and do away with the others.
In other words, IOTA never meant to be liked, or loved, by the blockchain community. Instead the team behind it set up to revolutionize the industry, and that’s something to understand.
And it’s not a matter of advertising or PR, either. Their industry connections mean that the team can go straight to important people without needing to drum up attention. A year ago, IOTA was publicly making industry connections. Those connections have only grown since. Recently, for example, Jaguar Land Rover announced intentions to work with the currency.
It’s actually difficult to know why there were ever standard expectations from IOTA, when the project has singled itself out from the beginning. Back in 2017 there were already reports stating how IOTA planned to be different. These reports even specified that IOTA hoped to build a network using the secure Internet of Things (IoT).
How IOTA might actually end up working out in today’s world
Having stated that we can’t measure IOTA the same way as other cryptocurrencies, let’s look at how we could measure its success.
There are dozens of possible, though not assured, uses for IOTA. Building an entire network using the internet of things is more than cryptocurrency. This network could actually revolutionize how we use technology, finally making smart cities a reality.
It’s not just a dream either. Or perhaps it is a dream, but a very well organized one. IOTA coin has already partnered with cities to make this a reality. More recently, they even tried to go further by announcing a competition to allow other brilliant minds to join them.
More recently, they announced a partnership with Austin Transportation to help automate transportation in the city. This announcement came high on the heels of a 20% price increase in their tokens. Such an increase might look small, but with many cryptocurrencies floundering or outrightly flopping, it’s an important step.
In fact, some analysts expect this upwards trend to continue. While it might not materialize (let’s remember analysts saying BTC would be worth $50,000 by late 2018,) the industry is clearly listening. And it secures more partnerships with companies, IOTA might even end up becoming the first among cryptocurrencies to go mainstream.
There are plenty of reasons why the open source and blockchain communities don’t like IOTA. Valid ones, even. But the truth is, right now IOTA is the one cryptocurrency project that’s most likely to break into the mainstream. It’s not a proper blockchain project. It’s not as secure or foolproof as pretty much most other blockchains out there. Those are facts.
But IOTA boasts what no other cryptocurrency does: industry backing. Far too many blockchain projects present great ideas, then flounder as they find it impossible to drum up industry attention. IOTA has it. With its prospects as a tool to resolve IoT security issues with blockchain, it might yet go places in the years to come.
About Stevan Mcgrath
Stevan Mcgrath, is a Bitcoin and cryptocurrency enthusiast, passionate about the potential these tools and blockchain technology bring to the world and writes consistently for CoinReview. He has been following development of blockchain for several years. To know his work and more details you can follow him on Twitter, Linkedin.