IOTA 2.0 list of all important terms
By: Lukas Wiesflecker
Tags: Blockchain, IoT, Iota, Crypto, Cryptocurrency

IOTA 2.0 list of all important terms

IOTA 2.0 explained in an understandable way

The Internet of Things is one of the most promising innovations in the area of blockchain and cryptocurrencies. Especially the IOTA Foundation is among the favorites and could provide a solid infrastructure in this area. With the release of IOTA 2.0, the cryptocurrency could take another vital step towards mass adaptation.

Due to the ongoing digitalization, the requirements for data traffic and communication between devices are also increasing. Here, IOTA relies on the technology of the Tangle to ensure a decentralized and secure exchange of sensitive data. MIOTA, the currency used in the network, is causing a stir, especially among investors and speculators. The IOTA forecast up to the year 2025 is predominantly positive.

As IOTA is not a regular blockchain, but an alternative system, the IOTA technical terms confuse many newcomers. Since the network is continually growing and new functions are added, the respective areas must be clearly defined.

What is IOTA?

The IOTA Foundation was founded in 2015 and focused on the Internet of Things. This generally refers to the infrastructure for efficient data exchange. While Bitcoin, for example, focuses on the transfer between two users (peer to peer), IOTA focuses on automated data exchange between devices (machine to machine). In addition to David Sønstebø, Sergey Ivancheglo, and Sergei Popo, the German Dominik Schiener is also on the founding team. The IOTA Foundation itself is a non-profit organization that focuses on developing the technology and keeps it royalty-free.

Since very high scalability can be achieved without a classic blockchain, transactions are significantly faster than in other networks. Besides, efficient data traffic can take place even with low computing power. Likewise, economic cycles can be monitored and automated, while at the same time, lower costs are incurred. These factors make the project particularly interesting for industry and business, and well-known investors such as Volkswagen and Bosch have already invested.

“Everything that can be digitized will be digitized.” — Carly Fiorina

Among the most critical cooperations of the IOTA Foundation are the Linux Foundation, Deutsche Telekom, Fujitsu, and Samsung. Together with these partners, IOTA wants to establish a data market based on its technology. Data and user behavior are among the most critical resources in many areas and have a very high value.

The introduction of IOTA 2.0 is the next important step to make this project possible. In the future, the project will be completely decentralized, and the central coordinator will be abolished. In several test phases, the transition to the actual Mainnet will then take place. For a better overview, the IOTA Foundation has provided the individual sections with their technical terms and published them on its website.

The Internet of Things is one of the most promising innovations in the area of blockchain and cryptocurrencies. Especially the IOTA Foundation is among the favorites and could provide reliable infrastructure in this area. With the release of IOTA 2.0, the cryptocurrency could take another vital step towards mass adaptation.

Due to the ongoing digitalization, the requirements for data traffic and communication between devices are also increasing. Here, IOTA relies on the technology of the Tangle to ensure a decentralized and secure exchange of sensitive data. MIOTA, the currency used in the network, is causing a stir, especially among investors and speculators. The IOTA forecast up to the year 2025 is predominantly positive.

As IOTA is not a regular blockchain, but an alternative system, the IOTA technical terms confuse many newcomers. Since the network is continually growing and new functions are added, the respective areas must be clearly defined.

If you want to trade Iota, then I can recommend Okex. There you can also get free Satoshis with a few small tasks.

IOTA 2.0 technical terms explained

Tangle

Instead of a cyclic blockchain, IOTA uses another technology, the Tangle. This is a directed acyclic graph (DAG) and provides higher scalability and lower transaction costs. While in a blockchain, all blocks are executed strictly one after the other. This is not the case with the tangle. Instead, it is a network of participants that are in contact with each other. To make a transaction, a participant must first verify at least two transactions in the network—the transaction amount's costs, thereby exclusively to the necessary computing power. The Tangle allows all transactions to run simultaneously. Besides, scalability increases with the number of participants.

Coordinator

The coordinator is a central instance that ensures the finality of transactions. It serves as a basis for trust in the network and should function decentrally as of IOTA 2.0. The coordinator also serves as protection for the tangle and makes attacks from outside more difficult.

Up to now, the coordinator is a node, which the IOTA Foundation operates itself. In regular intervals, it sends transactions without value, which serves as a checkpoint for the Tangle. Each transaction is only valid if it is directly or indirectly confirmed by the coordinator (milestones).

GoShimmer

GoShimmer is a prototype of the shimmer in the programming language Go. This node software achieves a consensus, which already works without a coordinator. Besides, several modules from Coordicide are already included, such as Autopeering and Mana.

Mana

Mana is a mechanism that should protect against Sybill attacks since IOTA 2.0. This mechanism guarantees that the consensus result makes the right decisions while two contradictory transactions are voted on. It is thus a parallel reputation system, which reflects trust through tokens (mana). The amount of Mana is always as high as the amount of MIOTA in a transaction. Thus a system is created, which can distinguish trustworthy nodes from new nodes.

Streams

Streams are a further development of Masked-Authenticated-Messaging (MAM). It enables developers to create cryptographic protocols in the Rust programming language. As a framework, it offers the possibility to develop specific protocols. These can be used for different types of data transmission, such as streaming. Such data streams can then communicate encrypted via the IOTA Tangle.

Chronicle

Chronicle offers a solution to store data from the Tangle permanently. This makes it easier for nodes to secure transactions in a fast, secure, and scalable database. Thus Chronicle enables permanent storage of the entire history of the Tangle.

IOTA 1.5: Chrysalis until the end of 2020

The first phase of the IOTA 1.5 Chrysalis Update is about to be released on Mainnet. The changes mainly bring improvements in the areas of performance, reliability, and usability. Due to the massive increase in performance, users can send and receive MIOTA tokens within ten seconds.

The following features are included in version IOTA 1.5:

URTS Tip Selection Algorithm

Improvement in the selection of milestones

White Flag

Autopeering

This significantly increases the number of transactions per second (TPS) to 1,000 TPS. The time to confirm a transaction (Milestone Insurance Rate) is reduced eightfold to 10 seconds. Also, improvements in the node software's reliability and performance and a faster setup through autopeering are evident.

For the second phase of the chrysalis, functions such as UTXO, Atomic Transactions, reusable addresses, and a binary transaction layout should be possible.

IOTA 2.0: Coordicide until 2021

It could still be a long way until IOTA 2.0 is finished. However, many problems in the network can be fought by introducing different modules. This concerns both the conflict during the voting process as well as various security measures. To bring a finished product to the market, the following functions must be guaranteed:

Responsibility of the nodes (identification of the network participants)

Reputation system through mana (trust and reputation)

Autopeering (security of nodes)

Rate control (spam and regulation)

Voting (conflict resolution)

The upgrade to IOTA 2.0 Coordicide will be done in several test phases.

Test phase 1: Pollen

The first of the three test phases is called Pollen and serves as a prototype version of a network without a coordinator. It functions as a research testbed and combines version IOTA 1.5 with version IOTA 2.0. With the implementation of GoShimmer, a node software, several modules for developers are to be incorporated into the network to eliminate the coordinator.

Test phase 2: Nectar

The second test phase, called Nectar, is a full implementation of modules from the Coordicide. This is used to fix bugs and problems before the modules are introduced into the mainnet. Participants will receive progressively increasing rewards for debugging (bug bounty)

Test phase 3: Honey

In the final test phase, Honey is the full version and the forerunner for IOTA 2.0. All functions and modules are integrated into this network. This version is also preceded by numerous test hours and audits. Honey is, therefore, the final specification of Coordicide.

IOTA 2.0: Bee

As a finished product and production-ready implementation of the Core Client, IOTA 2.0 is called Bee. This is based on the Rust programming language and does not require a coordinator. All previous developments are included in this version and merged as a uniform platform. When the final version is released, however, it isn't easy to predict.

Bee's goal is to develop a ready-to-use and standardized modular EEE (Environment Entity Effect) software architecture. This provides the entire infrastructure for communication between software components.

Conclusion: IOTA 2.0 advances the Internet of Things

The IOTA Foundation is undoubtedly one of the essential players in the crypto market. Because in contrast to many other crypto-currencies, the company tries to solve an existing problem. The demand from industry and economy for technical solutions and a good reputation speaks for this.

Especially the digitalization creates a high demand for a suitable infrastructure for data. These must be able to change hands decentrally, anonymously, and securely. This is the only way to prevent users from misusing their personal information. Private individuals can also retain full control of their personal data and decide for themselves how and by whom it is used.

“We live in a world that is drowning in data. We have the choice of continuing to ignore it and dismiss it as a big noise or of using it”. — Jorn Lyseggen

Also, the numerous well-known cooperations are considered a factor for the seriousness and success of IOTA 2.0. Besides Volkswagen, Bosch, Dell, and Jaguar, many other large companies are among the partners and hope for a breakthrough.

MIOTA is also one of the most popular cryptocurrencies among investors and investors speculating on an increase in value. These are available at Okex.

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