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David Sønstebø, Co-founder of the IOTA, on why the crypto world should get prepared to the blockchainless Distributed Ledger Technology.
IOTA caused an upset when it reached the top arena of CoinMarketCap, sending some altcoins trembling down the rankings, while others bid goodbye to the creme de la creme positioning.
The upset was intriguing, especially considering that IOTA traded almost $40 million in 24 hours after being listed on an exchange Although the success came hot on the heels of IOTA being touted as an exciting technology during its ICO, the rise was unprecedented.
Cointelegraph decided to ask David Sønstebø, Co-founder of the IOTA, for more clues about the sudden upshoot.
Cointelegraph: What has actually shot such a young project to higher crypto heights?
David Sønstebø: IOTA might have seemed to come out of nowhere, but it is actually two years in the making. In fact, before IOTA, we also invented full Proof of Stake through Nxt which was also the first Blockchain 2.0 and precursor to projects like t0 by Patrick Byrne. IOTA development began with hundreds of supporters back in 2015 and it has been covered in TechCrunch, VentureBeat, Forbes, Cointelegraph, CIO, etc. repeatedly, so I would argue that it is not such a 'young' project.
"However, we refused to do any paid promotion or exchange listing until the technology was mature enough, which is now."
CT: In many instances when altcoins rise astronomically, people attribute it to pump & dump. What is your take on that concerning IOTA?
DS: IOTA was already trading around close to 1 billion in the weeks before exchange launch via OTC/Over The Counter. IOTA has been traded for tens of millions of dollars over the last month leading up to this, so the price was very much in line with what we expected. There is certainly zero pump and dump.
CT: From the look of things, the growth has suddenly slumped. What accounted for that?
DS: The 'slump' in volume can be attributed to the fact that Bitfinex was under DDoS and had some issues with deposits and withdrawals, combined with the fact that we had to postpone a few releases and big announcements.
"Three million dollars volume while still only being listed on one exchange is still upper echelon territory, so we're not at all alarmed, again quite predictable given the temporary circumstances."
CT: Is the cryptocurrency community going to expect more disruption from IOTA?
DS: IOTA is barely out the gate publicly: we have only slowly begun releasing information about the partnerships that we have worked on with large organisations since late 2015 and 2016 -- certainly, a lot of news to come in this domain. Beyond that, if you read the IOTA roadmap you will see that we have a lot of IOTA modules in development that will greatly extend IOTA's functionality, so the answer is: definitely.
CT: What exact difference are you bringing to the landscape that is not already there?
DS: The most obvious differences that IOTA brings is a complete overhaul of the blockchain, by getting rid of the blocks and the chain and instead creating a Tangle/Directed Acyclic Graph. We have resolved the largest problems of blockchain: fees, scalability and centralization.
Having no fees means that micropayments are finally a reality. In IOTA, you can send 0.00001 cents if you want to and the recipient gets it all: this is a game changer in itself. For the first time ever you can conduct trustless transactions digitally without any fees. The other large issue that IOTA resolves is that of scaling: it is no secret that all public blockchains suffer from a terrible performance in terms of throughput. Even under ideal conditions, they do not scale to meet even slight real world demands.
"Because IOTA has no blocks and no chain, it has no bottleneck. Instead, the throughput grows in proportion to activity on the network. The more users/activity, the higher throughput. This means that we can finally take the public distributed ledger ideas and visions out of the lab and deploy it into the real world."
Finally, IOTA gets rid of the centralization incentive that exists within blockchain architecture. Blockchains always centralize around resources in the form of mining and staking-pools, because it makes economic sense. However, this leads to centralization of the ledger: the largest blockchains are controlled by a handful of mining pool operators, which again are at the mercy of their ISP providers.
CT: Any message for your community and the entire landscape?
DS: Distributed Ledger Technology is still in its infancy, but we believe that IOTA represents a large step towards maturing this landscape and actually bringing it into the real world. This is, of course, no easy task. It's a community effort, so I want to extend a welcome to any enthusiast in this space to join us in making Distributed Ledger Technology useful in the real world.
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