IOTA video notes - What is it? How does it work? Invest Yes or No?

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IOTA video notes - What is it? How does it work? Invest Yes or No?
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<p>&nbsp;<strong>IOTA:</strong><br>
I talk about<br>
- <strong>WHAT</strong> IOTA is<br>
- <strong>WHY</strong> it is so interesting<br>
- <strong>HOW</strong> it works and whether you should invest in it or not.&nbsp;</p>
<p><br>
These are just my cliff-notes for my IOTA video on YouTube.</p>
<p>German: <a href="https://www.youtube.com/watch?v=8pMr8iP0zmM">https://www.youtube.com/watch?v=8pMr8iP0zmM</a></p>
<p>English: &nbsp;coming soon<br>
</p>
<p>Official Websites: <a href="https://iota.org/">https://iota.org/</a></p>
<p>Whitepaper: <a href="https://iota.org/IOTA_Whitepaper.pdf">https://iota.org/IOTA_Whitepaper.pdf</a>&nbsp;</p>
<p>Check out Slack for info! https://ten-x.herokuapp.com/</p>
<p><br>
<strong>Talk about problem first:</strong> SCALABILITY OF TRANSACTIONS! &nbsp;</p>
<ul>
  <li>• Connect Internet of Things (Explain what it is!) will have billions of things and will need many Micro- and Nanopayments (will explain in separate video!)</li>
  <li>• BTC: ca 6/sec (Lightning Network &amp; Larger Block size will help) also COMIT!</li>
  <li>• ETH: ca 15/sec (PoS will increase that though)</li>
  <li>• most blockchains can’t handle the scalability problem</li>
</ul>
<p><strong>WHAT IS ITOA?</strong> &nbsp;</p>
<ul>
  <li> IOTA seems like a 3rd generation decentralized ledger (after Bitcoin and Ethereum) trying to solve that. So far: great idea - no application yet - purely speculative.</li>
</ul>
<p><strong>HOW DOES IT WORK?</strong> &nbsp;</p>
<ul>
  <li> Tangle - open source distributed ledger - no fees, no blocks</li>
  <li> no difference between user und validator (miner)</li>
  <li>• data structure is a graph, not a blockchain</li>
  <li>• graph: objects connected by vertices</li>
  <li>• objects are transactions</li>
  <li>• in order to create transaction you have to validate 2 other Tx</li>
  <li>• arrows point towards confirmed Tx</li>
  <li>• no blockchain - no blocks and no chain</li>
  <li>• direct and indirect confirmations</li>
  <li>• tangle is more regional - not everyone checking everyone! Example of shared work: not everyone doing everything, but trusting others until they confirm.</li>
  <li>• The more arrows to a Tx, the more confirmations</li>
  <li>• Tangle is the revolutionary part of IOTA</li>
  <li>• Slack: find neighbours etc - be careful of scams!</li>
  <li>¥ Tips: transactions which have no other transactions referencing them.</li>
</ul>
<p>ADDRESSES: &nbsp;</p>
<ul>
  <li>• Seed: String consisting only of uppercase latin letters and 9's which is used to access an account. A seed is like a private key/password. <strong>Keep it secure and don't share it with anyone.</strong> If someone has access to your seed they can access your account.</li>
  <li>• Consisting of 81-chars, only latin letters and 9's</li>
  <li>• Quantum resistant cryptography: Winternitz Signature instead of ECC</li>
  <li>• <a href="https://eprint.iacr.org/2011/191.pdf">https://eprint.iacr.org/2011/191.pdf</a></li>
</ul>
<p><strong>Nonces are NOT for PoW - it is for spam protection!</strong> Spam protection: &nbsp;</p>
<ol>
  <li>1. fees (ripple)</li>
  <li>2. limit (bitcoin)</li>
  <li>3. work (iota)</li>
</ol>
<ul>
  <li>• consensus is part of TenX mechanism - no fees (TenX fees are for consensus from Miners)</li>
  <li>• Miner vs. User</li>
</ul>
<p><br></p>
<ul>
  <li>• Nodes have “weight”: the more the deeper the more confirmed</li>
  <li>• Depth = Time</li>
  <li>• Weight = confirmations</li>
  <li>• Height = distance from Genesis TenX</li>
  <li>• Score: how much have you verified (directly and indirectly) - the higher the better</li>
</ul>
<p>WHEN IS IT TOO LARGE? Snapshots are being made - coordinators! <a href="https://pastebin.com/NdQjLWbK">https://pastebin.com/NdQjLWbK</a><br>
TECH: &nbsp;</p>
<ul>
  <li>• Javascript &amp; Python - that’s good</li>
  <li>• Go, Rust, C++ too… that’s all good!</li>
</ul>
<p>WHAT ARE THE TECH CHALLENGES: &nbsp;</p>
<ul>
  <li>• system for NO lazy notes (only certain amount is considered new and ok - f.e. 50%)</li>
  <li>• Confirmation takes a few hours on a phone - less than a minute on a good computer – better to outsource? Fees could come in there!</li>
  <li>• Scalability - coordinator right now - should be switched off at some time – should “snapshots” be totally decentralized?</li>
  <li>• high load vs. low load to keep load low! Goal: keep tips low</li>
</ul>
<p><br></p>
<ul>
  <li>¥ ATTACKS!</li>
</ul>
<p><br></p>
<p>WALLETS / EXCHANGES: &nbsp;</p>
<ul>
  <li>• <a href="https://github.com/iotaledger/wallet/releases">https://github.com/iotaledger/wallet/releases</a></li>
  <li>• Initial trading on Slack</li>
  <li>• Today on bitfinex - why no other exchanges?&nbsp;</li>
  <li>• New tech! Liquidity squeeze - helps price!&nbsp;</li>
</ul>
<p><br></p>
<ul>
  <li>• No inflation! Huge amount - MIOTA = million!</li>
  <li>• 1 MIOTA has 1,000,000 iotas</li>
  <li>• Why is the price that high? Well, think of how many Satoshis there are!</li>
  <li>• miota = million</li>
</ul>
<p>PARTNERS: &nbsp;</p>
<ul>
  <li>• Healthcare , Microsoft, Refugee non-profit, trusted IoT alliance - many other companies:</li>
  <li>• <a href="https://azure.microsoft.com/en-gb/blog/azure-blockchain-update-5/">https://azure.microsoft.com/en-gb/blog/azure-blockchain-update-5/</a></li>
  <li>• <a href="https://www.cryptocoinsnews.com/iota-spearheads-dlt-research-in-norway/">https://www.cryptocoinsnews.com/iota-spearheads-dlt-research-in-norway/</a></li>
  <li>• <a href="https://www.cryptocoinsnews.com/iota-foundation-enters-historic-partnership-with-refugee-nonprofit/">https://www.cryptocoinsnews.com/iota-foundation-enters-historic-partnership-with-refugee-nonprofit/</a></li>
</ul>
<p>OUTLOOK: &nbsp;</p>
<ol>
  <li>1. TX mostly (micro etc. cause no fees)</li>
  <li>2. oracles in the future</li>
  <li>3. smart contracts in the future</li>
</ol>
<p>This simple rule leads to:<br>
<strong>the more people use IOTA, the more transactions get referenced and confirmed</strong><br>
<br>
Economic Problems: &nbsp;</p>
<ul>
  <li>¥ Will it actually work?</li>
  <li>¥ Will hardware integrate this system? Big challenge.</li>
</ul>
<p>INVEST - Yes or No? relatively low volume for it’s size (1 billion vs. 10 million cap) &amp; billion dollar market cap… be careful<br>
Users? 0 Businesses? 0 Devices? 0&nbsp;</p>
<p><br>
I put some money into it - it is risky, but I like when companies push tech forward.<br>
&nbsp;</p>
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