Founded in 2017, IoTex is a scalable blockchain network that is taking the Internet of Things (IoT) landscape to a new level. An exponentially growing market, IoTeX aims to become the blockchain powering the IoT ecosystem.
According to research firm GlobeNewswire, the IoT market was valued at $308.97 billion in 2020. Its value is expected to increase at a compound annual growth rate (CAGR) of 25.4% to reach approximately $1,855 billion by 2028. IoT devices are capable of collecting and transferring large amounts of data, and IoTeX aspires to become the underlying blockchain to securely facilitate transactions.
The story behind IoTeX?
Founded by Jing Sun, Raullen Chai, Qevan Guo and Xinxin Fan, IoTeX is a decentralised and easily scalable blockchain network for IoT. According to its developers, "everyday people and businesses can own and control their devices" via IoTeX, which uses a blockchain-in-blockchain mechanism with a single root block and multiple connected sidechains. Its unique Roll-Delegated Proof of Participation (Roll-DPoS ) consensus mechanism gives it the speed and scalability to connect IoT devices block by block.
With a team of more than 30 researchers, IoTeX has connected more than 9,500 devices and completed more than 14 million transactions to date. The two devices connected on the IoTeX blockchain network are:
- Ucam: a smart home security camera device with blockchain-based identity and login capabilities for strong data privacy and control.
- Pebble: a sensor-like device that can capture information such as location, climate and movement, and process it on the IoTeX network for accurate real-time data.
What is IOTX?
IOTX is the cryptocurrency that powers the operation of the IoTeX blockchain. It is an ERC20 token that serves as the gateway to the IoTeX marketplace. Using the IOTX token, you can connect IoT devices to the IoTeX network. Network transactions below $0.10, smart contracts and decentralised applications (DApps) are all facilitated using IOTX tokens.
IOTX coin holders can participate in the IoTeX network governance team by staking and voting for delegates, shaping the future of the network. Anyone who owns IOTX can stake it to earn voting rights, allowing users to vote and help govern the IoTeX ecosystem. By voting, users can also earn up to 10% of the total amount they bet.
How does IoTeX work?
IoTeX works by connecting machines to humans via a scalable blockchain network. While scalability is a major issue for many blockchain networks, IoTeX overcomes this barrier by enabling real-time transactions at very low cost. Different IoT applications have different needs, and it is impossible to put all connected IoT nodes into a single blockchain.
The IoTeX blockchain focuses on this area by delegating tasks via sidechains. Each sidechain is designed to provide a single function for a given application. Attached to the root block, these sidechains can interact with each other as required, reducing the load on a single blockchain and increasing efficiency levels.
The root chain is responsible for ensuring security and enabling governance on the network, while its side chains or sub-chains enable connection to IoT devices with similar purposes or to work in a similar environment.
What is IOTX used for?
IOTX serves several different purposes in the IoTeX blockchain. It is useful for everyone involved in the network, including delegators, stakeholders and service providers. The main purpose of the IOTX coin is to establish the necessary incentives to ensure proper maintenance and operation of the IoTeX network in a decentralised manner.
Some other uses of the IOTX token are:
- Payment of gas fees required for transactions and enforcement of smart contracts on the IoTeX blockchain.
- Stakeholders in IOTX coins can vote and select delegates to lead consensus and help with governance.
- Payment for any service used.
- Registration of any device by staking and engraving.
What makes IoTeX unique?
While most blockchain networks are built on top of already existing blockchains like Ethereum or Hyperledger, IoTeX's blockchain network is built from the ground up, from its IoT middleware to the unique Roll-DPoS consensus it uses.
Another thing that makes IoTeX unique is its approach to creating true decentralisation on its blockchain. Typically, today's IoT devices and the data they collect are governed and controlled by private or public organisations. To access services from IoT devices, users often have no choice but to authorise companies to use their data.
The IoTeX blockchain envisions a future where users of smart devices control their data. IoTeX enables a decentralised network for IoT devices where consumers can take control of their privacy, while ensuring that the quality of services offered is not compromised.
Key features
IoTeX solves the scalability problem of most blockchain networks through four major components: Roll-DPoS, layer 2 protocols, edge computing and inter-network communication.
Roll-DPoS
Roll-DPoS consensus works by electing a specific number of delegates/block producers for a blockchain network. Stakeholders use their votes to elect block producers, who must then continue to build blocks and add them to the network. Delegates are rewarded for adding new blocks and distribute the rewards received to the stakeholders who voted for them. In this way, block producers and stakeholders have an incentive to maintain the decentralisation of the IoTeX blockchain.
Layer 2 protocol
The IoTeX blockchain-in-blockchain network is made possible through the use of Layer 2 protocols. It provides an open architecture to add multiple use cases and applications based on different cryptocurrencies. This is achieved through a mutually collective trust developed from the same delegate pool, making it easy to create a sub-chain to add different IoT devices.
Edge computing
Using layer 2 protocols, the IoTeX blockchain enables edge computing to share a trust economy for creating privacy-centric DApps.
Inter-network communication
The IoTeX root chain can facilitate communication with all sub-chains, enabling inter-chain interactions and governance. This is achieved through its block finality mechanism. Block finality ensures that any block created on the IoTeX network, whether on the root chain or the sub-chain, cannot be modified. This protects confidentiality while enabling interoperability.
IoTeX: advantages and disadvantages
Although the IoTeX network can have a positive impact on the global blockchain infrastructure, it is not without its shortcomings. Here we list some of the advantages and disadvantages of its blockchain.
Advantages of IoTeX
Low cost per transaction
Given that smart devices can collect a huge amount of data, the biggest challenge is transferring that data via blockchain. With IoTeX's layer 2 protocols, the speed of each transaction is increased while its cost is dramatically reduced, making it easier for users to adopt the blockchain network.
Confidentiality
Because the IoTeX network gives users control over their data, they don't have to choose between privacy and services, unlike other IoT networks.
Interoperability
IoTeX's root chain and sub-chain architecture enables interoperability between applications and smart devices connected to each side chain. This interoperability allows devices to increase their efficiency by interacting with each other when necessary.
The disadvantages of IoTeX
Incomplete decentralisation
Because the Roll-DPoS consensus selects specific delegators that govern the blockchain network, it is not completely decentralised.
High volatility
Like many new cryptos, IOTX is highly volatile, which can be seen from the sudden highs and lows in its price so far.
Final thoughts on IoTeX
Founded just over three years ago, the IoTeX blockchain has shown immense potential so far. Due to the network's capabilities, we're likely to see more IoT devices and DApps developed on its network, which will have an impact on the overall price of IOTX. This is just the beginning for IOTX in the market, and the IoTeX team still has a long way to go.
