Iota (MIOTA) is a distributed ledger network (DLT) and its associated native coin, MIOTA. Iota calls its network "Tangle" and highlights several differences from blockchain technology, such as parallel activity. The network does not require transaction fees and was created with the Internet of Things (IoT) in mind.
▪️How does Iota work?
Blockchains primarily serve as immutable methods for transferring information and value. Blockchains typically operate in a linear fashion, forming blocks containing transactions added in a specific order to form a chain. In some ways, blockchains rely on intermediaries (such as miners on proof-of-work blockchains), creating open market, fee-based systems.
Compared to blockchain technology, what makes Iota unique? Iota's global network, Tangle, does not have blocks and does not operate in a linear manner. Although the Iota network is essentially an immutable record of network activity, similar to a blockchain, it operates in parallel instead of linearly.
In the form of a directed acyclic graph (DAG), a Tangle is essentially a set of interconnected, simultaneous transactions operating according to its own set of parameters. Each new transaction is added to two or eight previous transactions. New transactions are joined to the front of the network at different points, allowing for a more flexible and parallel structure compared to a blockchain. Because Tangle does not require transaction fees, its system differs from the open market atmosphere of blockchains with fees.
