IOTA (MIOTA)–Earlier today, the IOTA Foundation brought an end to weeks of speculation surrounding the Qubic project. Being touted as the most eagerly awaited development in the history of IOTA, the new project seeks to create a protocol that “specifies IOTA’s solution for oracle machines, smart contracts, outsourced computations, and more.”
While early speculation had Qubic as an attache currency to the already established IOTA coin, the press release has put a definitive end to that line of thinking, stating that “Qubic is not a new token or coin; there will be no Qubic ICO or airdrop.” To put simply: Qubic is an application that will seek to improve upon the existing IOTA model, in addition to using the currency for various features. In example, smart contracts initiated through Qubic (as opposed to a rival cryptocurrency such as Ethereum) will be paid out in IOTA. The technology is designed to rely heavily upon the free, highly scalable network transactions of Tangle, to provide everything from seamless micropayments for streaming services and other innovations, to a reward system that incentivizes users to participate on the Tangle network.
The press release is careful to emphasize that Qubic is still a work in progress, and the application has months or even years left of development before users see the full potential of the technology. That being said, the emphasis on smart contracts is clearly an indication that IOTA is looking to evolve beyond a transactional currency. While the Internet of Things cryptocurrency has long targeted IoT devices as its potential base (constituting a worldwide supply of over 8 billion), the currency has still been built through the roots of traditional transacting currencies. Tangle offers significant advantages over the majority of the market, with the ability to scale as needed to handle increased network loads. While early generation cryptos like Bitcoin rely upon miner regulated transactions, which increase the cost of sending BTC in addition to contributing to high network congestion, IOTA uses Tangle and user support on the network to institute free transactions that will, in theory, retain the short transaction times as the network scales to greater user volume.
IOTA Challenging Ethereum Over Smart Contracts
A Twitter user (@FrancLukas1), has done a fantastic job of distilling the new Qubic press release into a workable understanding for the community.
The general idea is that with Qubic, IOTA is now incorporating the best features from two facets of cryptocurrency. The first is utility as a digital currency, ala Bitcoin, which allows users and developers to implement IOTA for mercantile purposes. Driven by fee-less transactions and fast network speeds, IOTA offers significant advantage over the market, blowing away the 10x improvement necessary to compete in an established industry made popular by former Paypal CEO and venture capitalist Peter Thiel. Through Tangle, IOTA is not limited by the barrier to scale that has plagued Bitcoin since the start of 2017. While BTC has managed to retain market dominance and brand recognition through the bear cycle of 2018, the original cryptocurrency has yet to implement a method for overcoming the crippling network congestion that accompanies increased interest and network volume in the currency. Tangle scales with user volume, meaning the currency should have no problem growing in proportion to the adoption of IOTA and IoT connectivity.
With Qubic, IOTA also offers the same network features as Ethereum, particularly the ability to construct smart contracts which can then be paid out in MIOTA. Ethereum, like Bitcoin, is limited by rising transaction fees and slow TPS (transaction per second) outputs that diminishes the usability of the currency. IOTA unites Tangle with Qubic to create an infinitely scalable, zero fee transaction-capable network, that has the same platform building features so enticing to developers looking to drive innovation through cryptocurrency.
As FrancLukas1 put it in his ELI5 post, “All those coins are now added to the ever-growing heap of coins that are dead men walking. They have a competitor who can do it for free, with infinite scalability.” Jimmy Wales, co-founder of Wikipedia, made a jarring statement at a blockchain event earlier in the week that cryptocurrency is “in a bubble, the cryptoworld is absolutely, definitely in a bubble.” Developments like Qubic are further proving Wales’s statement correct, not in condemnation for IOTA, but in the lack of feasibility for the majority of the market. The monetary capitalization for cryptocurrency in five years is likely well beyond today’s 350 billion USD, but that amount will be concentrated in far fewer currencies. Most of cryptocurrency is made up of empty ICO and pump and dump projects that have little to offer by-way of solving real world problems. IOTA, in light of the Qubic announcement, is proving to be a long-term player in the field of cryptocurrency disruption.