Tezos (XTZ) Blockchain Explained
In 2017, the Tezos ecosystem came to the market, offering all the functionality of Ethereum, but with more developed protection. It was achieved using specialized tools, as well as the possibility of updating the algorithm, in changing realities, which gives greater flexibility not only to the parent network but also to all internal.
A noteworthy point is a fact that the project was implemented by a commercial structure (DLS, USA), and not by a group of enthusiasts. The development of Tezoss according to unconfirmed data was initiated in 2011, but the official start date is 2014. At the same time, the ICO was planned only for mid-2017, and the developers promised to implement the project after collecting the necessary funds. Despite such deadlines and questionable prospects, the campaign to raise funds for the development of Tezos has become one of the most successful, in bitcoins and ether was collected 232 million dollars.
What is Tezos?
The verification of the code of each transaction is made by mathematical calculations of its compliance. The main objectives of the network were to support smart contracts and decentralized applications (Xapps).
Blockchain XTZ is divided into three main blocks:
- The level of consensus.
Even though all the blocks are interconnected, they were created in the form of modules that are subject to edits and updates without affecting the rest of the components.
- Written by Tezos on Ocaml, the key advantage of this approach is the ability to verify parts of the Protocol. Among the drawbacks – the programming language is rarely used, which creates difficulties in development;
- Unique Virtual Machine. Creators of Tezos have developed their own virtual machine, it works on Michelson;
- The possibility of a layer-by-layer Protocol update is implemented. The Protocol itself is divided into 3 layers (network, transaction layer, and consensus layer);
- The consensus algorithm is based on PoS (proof of Stake), which fundamentally distinguishes Tezos from the same Bitcoin and other cryptocurrencies. PoS allows you to increase the speed of transaction confirmation, because not all miners, but only a part of selected validators will participate in their verification. For the use of PoS in this form, as described in 2014, many authors of the cryptocurrency are scolded, it is much inferior to BFT PoS algorithms, in particular, makes validators vulnerable to DDOS attacks.
The platform works similarly to many other blockchains, but with a key difference. This innovative difference lies in the fact of how you can add and make changes to it. This is done as follows:
The developer offers some changes or updates to the Tezos Protocol. If the change is approved by the community and included in the list of the next service pack, its author will receive a reward in XTZ tokens. This approach has two advantages. It encourages developers to participate in the development of the network and decentralizes its maintenance and development.
Since developers receive tokens only for approved updates, they can expect almost instant compensation for their work on the Tezos network. They don’t need a corporate sponsor, employer or any other traditional financial reward.
This project is also interesting because it allows you to create network flows that should accelerate the development of new functions, as well as to detect and fix errors faster compared to other blockchains. Any interested parties will be able to participate in this process.
Self-Amending is a process in which the holders Tezos can put their Tez for a long or a short time with easy operations of the purse, and make a profit for it.
Important: your tokens are not blocked in the delegation, you can use them at any time. When you delegate, you send the coins to a smart contract, under the terms of which, the bakers will return your share of the profits, as well as, a smart contract does not allow you to lose your coins!
If you have XTZ tokens, but you do not plan to run your node, then you delegate (transfer for a while) coins to miners, for which you receive most of their reward. Manners collect a pool to raise a common public thesis node (there are more coins on the common wallet now, which means higher chances of finding blocks and more weight of the vote). The delegation provided for in the wallets Tezos as a function.
Baking is a liquid Proof-of-Stake consensus (proof of bet). Baking is the act of signing and publishing blocks in The Tezos blockchain. Bakers check all transactions and add them to the blockchain. Baking is an innovative method of issuing digital money.
The average income in 2019 – 7.8% per annum, which over time and maintaining the trend we will reach at least 5.51% per annum.
Transactions for the purchase and sale of the Texas platform token are currently available only on three exchanges:
The first and second coins are traded in pairs with BTC, USD and ETH, and the third with BTC and USD.
The thesis is not a fraudulent project, the companies really exist and the real work on the launch of the blockchain is underway. So far, the experts approximately 20% allocated to what Tezos do will Eclipse not only Ethereum, and Bitcoin 50-60% allocated to that project will be the fate of Ethereum, i.e. approximately 2-3 place capitalization.
Despite this, analysts note the cryptocurrency’s potential for growth. After a significant fall, it was fixed in a stable range, taking into account the positive expectations of investors; we can expect a gradual increase in its value.
However, the long-term perspective of Tezos is entirely related to the development of the project. Developers have yet to settle the issue with the deceived expectations of investors, as well as to provide the community with a full platform. If these actions are successful, we can talk about good support for growth.