We have built an ERC-20 complaint token on the Ethereum blockchain (if you are interested in the project visit www.crypto-mark.com), which we are currently distributing to people in a series of bounty campaigns. At the beginning of December we tried to pay out the latest distribution round to a relatively small number of around 70 people - but it was impossible to do. The Ethereum blockchain was congested by the cryptokitties hype and transactions became incredibly expensive - if possible at all.
Once again we had to realize what the shortfalls of the current blockchain technology are: A lack of scalability and the cost of transactions.
Longingly we watch the development of IOTA, which could solve all of these problems with its tangle technology:
- 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.
No wonder that giants such as Microsoft, Daimler, BMW, Bosch, Deutsche Telecom, Accenture or PWC have shown interest in the IOTA technology - and yes we are eagerly waiting to be able to move our crypto coins to the IOTA tangle, as it would allow fast and free transactions of our crypto currency in the future. Let's face it, if you run a crypto currency it is annoying that you need another crypto currency like ETH to be able to do anything with your own crypto currency.
So we do indeed believe that IOTA could be the future of the blockchain technology (though itself is not a blockchain) and that it could potentially disrupt the crypto currency space a lot. So at first glance this looks like it could be a must have coin in the crypto currency space with the potential to show incredible price increases in the future.
But at second glance, the picture is not so bright anymore:
Part of the excitement about IOTA comes from the fact that it does not require any transaction costs. As said, we want to move to IOTA as it would our crypto currency to work without the need of owning any other crypto currency.
But if that is the case, what do you need IOTA for then? What would be the difference between our crypto currency and IOTA? Both would run on the same technology and would have probably similar features?
And this is the reason why we believe that the IOTA coins will 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.
The IOTA could thus prove to be worthless in the end - despite its own technological success.
Are we missing anything? Are our thoughts completely wrong? Please let us know.