Explained: What Is IoTeX (IOTX)?

Introduction

Founded in 2017, IoTex is a scalable blockchain network that takes the internet of things (IoT) landscape to a new level. An exponentially increasing market, IoTeX aims to become the blockchain powering the IoT ecosystem. 

According to research firm GlobeNewswire, the IoT market was valued at $308.97 billion in 2020. Its value is expected to increase at a compound annual growth rate (CAGR) of 25.4% to reach approximately $1,855 billion by 2028. IoT devices are able to gather and transfer large amounts of data, and IoTeX aspires to become the underlying blockchain to facilitate transactions in a secure manner.

IoTeX’s native cryptocurrency, IOTX, has been on a bullish run lately. Although its price started at $0.06, IOTX achieved an all-time high (ATH) of over $0.15 in the last few days of this writing, providing over 200% in returns to its investors. 

What Is IoTeX?

Founded by Jing Sun, Raullen Chai, Qevan Guo and Xinxin Fan, IoTeX is an easily scalable, decentralized blockchain network serving the IoT. According to its developers, “[E]veryday people and businesses can own and control their devices” via IoTeX, which uses a blockchain-in-blockchain mechanism with a single root block and multiple sidechains connected to it. Its unique roll-delegated proof of stake (Roll-DPoS) consensus mechanism gives it the speed and scalability to connect IoT devices block by block.

With a team of over 30 researchers, IoTeX has connected over 9,500 devices and completed more than 14 million transactions to date. Two devices connected on the IoTeX blockchain network are:

• Ucam
  : A home security smart camera device with blockchain-based identity and login capabilities for robust privacy and control over data.
• Pebble
  : A sensor-like device that can capture information such as location, climate and motion, and process it over the IoTeX network for accurate real-time data.

What Is IOTX?

IOTX is the cryptocurrency that fuels the workings of the IoTeX blockchain. It’s an ERC20 token that acts as an entryway to the IoTeX market. Using the IOTX token, you can connect IoT devices to the IoTeX network. Network transactions below $0.10, smart contracts and decentralized applications (DApps) are all facilitated with the help of IOTX tokens.

IOTX coin holders can participate in the IoTeX network’s governance team by staking and voting for delegates, thereby shaping the future of the network. Anyone who owns IOTX can deposit it to earn voting power, which enables users to cast votes and help govern the IoTeX ecosystem. By voting, users can also earn up to 10% of the total amount they stake.

How Does IoTeX Work?

IoTeX works by connecting machines with humans through a scalable blockchain network. While scalability is a major issue for many blockchain networks, IoTeX overcomes this hurdle by enabling real-time transactions at very low cost. Different IoT applications have different needs, and it’s impossible to put all connected IoT nodes into a single blockchain. 

The IoTeX blockchain focuses on this area by delegating duties via sidechains. Each sidechain is built to provide a unique function of a given application. Attached to the root block, these sidechains can interact with each other when required, decreasing the load on a single blockchain and increasing efficiency levels.

The root chain is responsible for providing security and enabling governance over the network, while its sidechains or subchains make it possible to connect to IoT devices with similar purposes, or to work in a similar environment.

What Is IOTX Used For?

IOTX has several different purposes in the IoTeX blockchain. It’s useful for everyone participating in the network, including delegators, stakeholders and service providers. The core purpose of the IOTX coin is to establish the incentives required to ensure appropriate maintenance and functioning of the IoTeX network in a decentralized manner. 

Some other uses of the IOTX token are:

• Payment of gas fees required for transactions and enforcing smart contracts on the IoTeX blockchain.
• Stakeholders of IOTX coins can vote for and select delegates to run the consensus and help in governance.
• Payment for any service used.
• Registration of any device through staking and burning.

What Makes IoTeX Unique?

While most blockchain networks are built atop the foundation of already-existing blockchains like Ethereum or Hyperledger, IoTeX’s blockchain network is built from scratch, from its IoT middleware to the unique Roll-DPoS consensus it utilizes.

Another thing that makes IoTeX unique is its approach to creating real decentralization on its blockchain. Typically, today’s IoT devices and the data they collect are governed and controlled by private or public organizations. In order to access the services of IoT devices, users often have no choice but to give businesses consent to use their data. 

The IoTeX blockchain envisions a future where smart device users have control over their data. IoTeX empowers a decentralized network for IoT devices where consumers can take privacy into their own hands — while ensuring the quality of services offered isn’t compromised.

IoTeX: Key Features

IoTeX solves the scalability issue of most blockchain networks through four major components: Roll-DPoS, Layer 2 chains, edge computing and cross-network communication.

Roll-DPoS

Roll-DPoS consensus works by electing a specific number of delegates/block producers for a blockchain network. Stakeholders use their votes to elect the block producers, who then have to continue building blocks and adding them to the network. The delegates are rewarded for adding new blocks, and distribute the rewards received to the stakeholders who voted for them. Both block producers and stakeholders are thus incentivized to maintain the decentralization of the IoTeX blockchain.

Layer 2 Chain

IoTeX’s blockchain-in-blockchain network is made possible with the use of Layer 2 chains. It provides an open architecture for adding multiple use cases and applications based on different cryptocurrencies. This is done through mutually collective trust developed from the same pool of delegates, making it hassle-free to create a subchain to add different IoT devices.

Edge Computing

Using Layer 2 chains, IoTeX blockchain enables edge computing to share an economy of trust for building privacy-centric DApps.

Cross-Network Communication

IoTeX’s root chain can facilitate communication with all the subchains, enabling cross-chain interactions and governance. This is achieved through its block finality mechanism. Block finality ensures that any block created on the IoTeX network, whether on the root chain or subchain, cannot be changed. This safeguards privacy while allowing interoperability.

IOTX Tokenomics

The IOTX coin has a live market cap of over $1 billion and a 24-hour trading volume of nearly $37 million. As of this writing, IOTX’s 24-hour high and low are $0.13 and $0.12, respectively. Out of its maximum supply of 10 billion tokens, IOTX’s current circulating supply stands at just over 9.5 billion.

There was no public sale held for the initial supply of IOTX coins. However, a private sale was held in February 2018. At that sale, 24% of the total supply was released of which 6% was distributed immediately, 6% in February 2019, 6% in May 2019 and another 6% in November 2019.

The remaining 76% was reserved as follows:

• 6% for community reward programs
• 15% for the core team
• 30% for the development of the ecosystem
• 25% for improving the IoTeX blockchain and its underlying technologies

IoTeX: Pros and Cons

While the IoTeX network can positively impact the global blockchain infrastructure, it’s not free of flaws. Here are some pros and cons of its blockchain.

Pros

Low Cost per Transaction

Since smart devices can collect a huge amount of data, the biggest challenge is to transfer that data over the blockchain. With IoTeX’s Layer 2 chains, the speed of each transaction is increased while its cost is greatly reduced, making it easier for users to adopt the blockchain network.

Privacy

As the IoTeX network enables users to control their data, they don’t have to choose between privacy and services, unlike with other IoT networks.

Interoperability

IoTeX’s root chain and subchain architecture allow interoperability among applications and smart devices connected with each sidechain. This interoperability allows devices to increase efficiency by engaging with each other when required.

Cons

Incomplete Decentralization

Since the Roll-DPoS consensus selects specific delegators who govern the blockchain network, it isn’t completely decentralized.

High Volatility

Like many new cryptos, IOTX is highly volatile — which can be observed from the sudden ups and downs in its price thus far.

Is IoTeX (IOTX) a Good Investment?

IoTeX shows great promise, and could pave the way ahead for IoT and blockchain. One of its closest competitors is IOTA, a project which shares its vision of secure data exchange. Compared to IoTeX, IOTA’s transactions fees are higher, as it uses a tool called DAG (directed acyclic graph), which adds to costs. 

IOTX has seen tremendous growth over the past few weeks. If this trend persists, we might see a long bull run. Of course, how the crypto will perform in the future also depends on factors such as new partnerships, products and MachineFi, which is similar to DeFi (decentralized finance) but tailored to machines. IOTX reached its current ATH of $0.26 following IoTeX’s MachineFi announcement in November 2021.

That being said, let’s take a look at some IOTX price predictions. DigitalCoin sees IOTX’s price exceeding $0.18 in 2022, and closing in on the $0.50 mark by 2028. Similarly, WalletInvestor forecasts a bullish run, predicting IOTX’s price to exceed $0.21 in 2022 and surpass $0.60 by 2026. Overall, it’s evident that IOTX is a good investment for the long term. However, as we’ve said, bear in mind that it’s a new cryptocurrency which is prone to volatility.

Buying IOTX

You can easily buy IOTX from a number of crypto exchanges that list it. Below are the steps for purchasing it on the Bybit platform.

Step 1: Start by creating your free account on the Bybit trading platform. If you already have an account, proceed to the next step.

Step 2: Log into your crypto account and head to the Fiat Gateway.

Step 3: Once you’re in the Fiat Gateway, select the cryptocurrency you want to purchase — IOTX in this case.

Step 4: Enter the number of IOTX coins you wish to purchase, or the amount of money you’re willing to spend.

Step 5: Select the preferred service provider and payment method. Various options such as Visa, Mastercard and bank transfer are available.

Step 6: Confirm the transaction and wait for the IOTX coins to arrive in your account.

That’s how easy it is to buy IOTX coins. Once you’ve received the IOTX in your account, you can use it for trading. Bybit is a great option due to its simple and easy-to-navigate user interface. Whether you’re a seasoned trader or just starting out, its simplicity is sure to suit your needs.

Closing Thoughts

Founded just over three years ago, the IoTeX blockchain has shown immense potential so far. Due to the network’s capabilities, we’re likely to see more IoT devices and DApps developed on its network, impacting the overall price of IOTX. 

It’s just the beginning for IOTX in the market, and the team at IoTeX has a long way to go. With announcements like MachineFi and solid products like UCam and Pebble, however, they appear to be on the right path.