IoTeX

What is IoTeX (IOTX)?

IoTeX is a full-stack platform that enables the use of trusted data from trusted devices in trusted decentralized applications (dApps). It empowers privacy-focused devices, apps, and services by combining blockchain technology, secure hardware, and layer 2 infrastructure.

IoTeX is a modern blockchain network that advertises specifications such as 5-second blocks and instant finality, along with over 1000 transactions per second throughput. It is also fully compatible with Ethereum’s Solidity smart contracts, making it easy for devs to port their dApps across.

This blockchain network is fundamentally based on the Internet of Things (IoT), which defines the connectivity of everyday objects and machines. IoTeX aims to supplement the IoT sector by creating a borderless environment of trust and privacy for humans and machines to interact in.

When Was IoTeX Launched?

As a project, IoTeX began in 2017, starting off as a decentralized, open-source platform targeting open economics for machines. IoTeX focused on interactions revolving around guaranteed trust and autonomy powered by robust economic incentives.

However, the IoTeX mainnet officially launched in April 2019. Since then, IoTeX has kept its Roll-DPoS blockchain running with over 60 worldwide delegates. Infrastructure built onto IoTeX helps to connect blockchains like Ethereum and Binance Smart Chain.

Who are the Founders of IoTeX?

IoTeX was founded by Raullen Chai, Qevan Guo, Xinxin Fan, and Jing Sun and is backed up by a global team of engineers and researchers.

Raullen Chai was formerly head of cryptography at Uber and holds a Ph.D. in Computer Science from the University of Waterloo. Qevan Guo shares a similar profile, with a Ph.D. in Machine Learning from the University of Singapore and experience as a product lead at Facebook.

Xinxin Fan is a former senior research scientist at Bosch and holds a Ph.D. in Cryptography from Waterloo. Finally, Jing Sun is a Managing Partner at Sparkland Capital as well as an LP at Polychain and an angel investor at Rippling.

The IoTeX team is also supported by renowned advisors, including Robert Parker, Jack Li, and Michael Cho. The project also has the backing of over 30 institutional investors, such as DraperDragon, HASHED, HashKey, Blockchange, and IOSG.

How Does IoTeX Work?

IoTeX is a decentralized network of users, developers, and enterprises brought together by an EVM-compatible layer 1 blockchain.

Layer 1 blockchains are decentralized public ledgers that are operated and secured by a large number of distributed nodes. These nodes are called miners on proof-of-work systems like Bitcoin or validators on proof-of-stake systems like IoTeX and Ethereum.

A blockchain is a series of blocks that are made up of two components. Firstly, blocks are bundles of information, such as recent transactions on the network. Paired with this data is a cryptographic hash of the previous block.

Thanks to this hash, each block is connected to the previous block. It also means that going back and trying to alter the information in a previous block changes the hash of that block, thus breaking the chain. For this reason, blockchains are immutable.

IoTeX powers smart devices, decentralized applications, and digital assets. It has already built out a significant ecosystem of devices such as Ucam, a CES-award-winning security camera that advertises 100% privacy.

Ucam replaces traditional password-based logins with blockchain-based logins. This means that Ucam users are secured by a blockchain private key that is, for now, and the foreseeable future, quite uncrackable.

This private key is used to encrypt all videos so they can only be decrypted and viewed on the user’s devices.

Another example of IoTeX’s utility is its partnership with Nordic Semiconductor on the Pebble Tracker. The Pebble Tracker is a dev-board that mixes blockchain and IoT and is equipped with a TEE and multiple sensors such as GPS, climate, motion, and light sensing.

Pebble captures and signs data from the real world using its sensing array and converts it into verifiable, blockchain-ready data. This data can then be used to mint digital assets, call smart contracts, train machine learning models, create crowdsourced indices, and much more.

The value brought by IoTeX to systems like the Pebble Tracker is tamper-proof software. Blockchains are, after all, immutable. This allows a system like the Pebble Tracker to be built with both tamper-proof software and hardware from a reputed manufacturer. Tamper-proof technology inspires trust.

What Makes IoTeX Unique?

IoTeX focuses not just on the Internet of Things but the Internet of Trusted Things. Part of this vision is the fact that users themselves, rather than institutions, are in complete control of their devices and data. This means no intrusive ads or surveillance, just privacy, and peace of mind.

By connecting the physical devices that surround users to the virtual world, IoTeX aims to democratize access to machine-backed dApps. The aim here is to maximize value for users by ensuring the new machine economy is in their hands.

How is the IoTeX Network Secured?

IoTeX is fundamentally a proof-of-stake (PoS) network, similar to many modern blockchain projects. In PoS, the network is upheld and secured by nodes called validators, who have to stake a certain amount of the network’s native token. They are then rewarded for good performance and sometimes punished for bad or malicious performance.

On IoTeX, these validating nodes are called “Delegates.” IoTeX also modifies PoS into a system called Roll-DPoS. This consensus mechanism randomly selects 24 out of the top 36 voted delegates to produce blocks every hour.

There are a total of over 60 delegates currently providing consensus for IoTeX. These delegates can be elected by IOTX holders, with 1 staked IOTX counting for a single vote. Delegates receive rewards for managing consensus, and they pass a portion of these rewards on to their voters.

What is the Use of IOTX?

The IOTX token is IoTeX’s utility token. It powers the platform by securing the network. IOTX is also used to pay for transactions on the IoTeX blockchain, including the registration of new devices.

In addition, IoTeX network documentation specifies that the IOTX token represents fractional ownership of the IoTeX Network. IOTX holders can spend, stake, and even burn IOTX to access network resources.

In summary, users of IoTeX pay for dApps and services and also stake and vote for delegates with their IOTX tokens. Developers power their devices and dApps with IOTX, delegates stake it, and service providers offer services to devices and dApps paid for in IOTX.

Device manufacturers will soon be able to burn IOTX in order to obtain a “Powered by IoTeX” certificate. This is a special virtual certificate that allows a device’s decentralized identification (DID) to access various services and functions.

Who Controls IoTeX?

IoTeX is a decentralized ecosystem that is neither owned nor governed by any single entity. All IOTX holders can stake their IOTX tokens to elect delegates and participate in network-wide governance voting.

Like any PoS system, the more IOTX tokens that are staked, the more resistant the network is to attacks.

How Much IOTX is In Circulation?

The IOTX token has a maximum supply of 10 billion, although this went down to 8.8 billion following the “Burn-Drop.” This Burn-Drop, powered by smart contracts, is a feature that sees the total IOTX supply reduce for every newly registered device.

265 million IOTX were burned in June 2020 as part of Mainnet GA activation, on top of the 900 million earmarked for burning via Burn-Drop.

24% of the IOTX supply was sold to non-US accredited investors in January 2018, raising 25,000 ETH, or approximately $25 million. These private sale tokens were fully distributed between 2018 and 2020.

The core IoTeX team received 15% of the total supply, subject to 4-year vesting with a 6-month cliff. This team allocation is supposed to last for over 10 years, including compensation for future core team members.

The IoTeX foundation, meanwhile, received 25% of the total IOTX supply. These funds are meant to build and evolve the platform and protocol, as well as to fund IoT research.

The Ecosystem Fund, for system bootstrapping and building strategic partnerships, was allocated 18% of the total supply. This fund includes the Halo Grants Program, amounting to 8% of the IOTX tokens supplied. 12% of the supply was reserved for Roll-DPoS mining rewards, and 6% of the supply was saved for community reward programs.

How Do You Buy IOTX?

You can buy IOTX instantly using several major cryptocurrency exchanges. Buying IOTX in a decentralized manner from IoTeX-based decentralized exchanges is also a great option. Thanks to IoTeX’s instant finality and 5-second blocks, buying IOTX is practically instant, whichever method you choose.

How Do You Store IOTX?

IoTeX has an official wallet called ioPay. This wallet keeps public and private keys secure and is available for both mobile and desktop. Importantly, you can directly stake your IOTX tokens and vote for delegates via the ioPay wallet.

IoPay also allows trading via the integration of the mimo DEX, allowing you to provide liquidity for IOTX, VITA, and XRC-20 tokens, as well as cross-chain assets from Ethereum. You can also use ioPay to hold your NFTs, of course. In fact, according to IoTeX, NFT holders will be eligible for special benefits in the future.

The native ioPay wallet is also compatible with hardware wallets like the Ledger Nano. If you want to connect your Ledger device to ioPay, check out this official tutorial.

IoTeX Energy Consumption

IoTeX is a delegated proof-of-stake network, which means network security is based on key node operators locking up tokens. Unfortunately, these node operators don’t have to have massive amounts of hardware to be profitable.

In fact, with only 60+ delegates, IoTeX as a network doesn’t consume much energy at all. More delegates mean more decentralization, but even if IoTeX were to grow to a few thousand delegates, each of these is a relatively simple computer and doesn’t require much power.

Is IOTX a Good Investment?

IoTeX is an Internet of Things project with the vision of individual ownership of data and full privacy, which can feel like a Utopian dream in a Web2 world.

For this vision alone, IoTeX can be considered a compelling project. However, the project also offers attractive tokenomics, with reductions in supply offered in the form of Burn-Drop. Adoption of the platform and onboarding of each new device seems geared not just to increase demand for the IOTX token but also to reduce supply.

However, IoTeX literature currently describes the IOTX token as providing fractional ownership of the platform. While they did not attempt to conduct a public ICO thanks to regulatory concerns, there may be a possibility of regulatory pressure in case the token is one day viewed as a security.