I first heard about IOTA and the tangle in late November last year and loved the idea immediately:
- It is fully scalable and becomes faster the more people use it.
- It does not come with any transaction costs as the sender of every transaction also takes over the role of the miner as he has to validate two other transactions.
- In the future it is supposed to be possible to also build smart contracts based on IOTA.
Microsoft, Daimler, BMW, Bosch, Deutsche Telecom, Accenture or PWC all showed interest it seemed - although the interest was not nearly as intense as a press release of the IOTA foundation made people believe.
So at least on paper IOTA could be the future of the blockchain technology (though itself is not a blockchain) and yes it could potentially disrupt the crypto currency space a lot. I therefor bought some IOTA (which is a troublesome process) - unfortunately after it had more than tripled within a few days.
Then I looked deeper into the investment idea and at second glance the picture was not so bright anymore:
Part of the excitement about IOTA comes from the fact that it does not require any transaction costs. This should be very attractive for ICOs as it would allow developers of their own coin to be transferrable without transaction costs and it would remove the need to always keep some other crypto currency in your wallet to pay for transaction - which is not really cool for a new currency....
But if that is the case, what do you need IOTA for then? What would be the difference between newly invented crypto currencies on the IOTA tangle and IOTA itself? Both would run on the same technology and would have probably similar features?
And this is the reason why I believe that the IOTA coins might become a victim of their own technological success. Do you really believe that the ride hailing services of the future will be paid in IOTA? No, most likely they will be paid by a native coin of the company that runs the service, (call it the UBER...) which will be pegged to the USD or the EUR.
Will sensor data be paid in IOTA? Why should it? Big industrial companies would most likely prefer something pegged to a fiat currency - and they could easily create this based on IOTA.
Once thousands and millions of smart devices from the IoT world would enter the IOTA space, the network would most likely get better and better and faster and faster. But the IOTA coins, which have been the first smart contract built on the technology will not be necessary anymore for the stability of the network.
I have thus sold my IOTA - and prefer steem.
Am I missing anything? Do you see it differently? Please let me know.