Here are a few misconceptions surrounding IOTA cryptocurrency.
Misconception : IOTA transaction fees will increase when the network grows
Reality : IOTA transactions are free. By free I mean zero transaction fee. And it will always be zero however big the network grows.
Misconception : IOTA transactions are not free in the sense that PoW is being done for each transaction. When number of transactions increase, it will require huge mining farms.
Reality : The PoW in IOTA is very small . Even when the network becomes huge, it won’t increase significantly. Not to the extent of requiring mining farms. As there are no miners involved, there is no competition for reward. Hence no progressively increasing network difficulty.
Misconception : IOTA is premined and the developers hold most of the coins
Reality : IOTA is not premined. It was fairly distributed in an ICO. Read this bit from the IOTA Wikipedia page
“the team began developing IOTA in early 2015. To ensure equitable token distribution, a crowdsale was held from November to December 2015 during which 100% of the token supply was issued. Zero tokens were held for the developers/founders. The equivalent of 1,337 Bitcoins were raised from the crowdsale (in the form of BTC, NXT, and Jinn tokens). Since none of the token supply was allocated to developers/founders, the community decided to support the project’s vision by donating a significant amount of resources in order to establish the non-profit “IOTA Foundation” registered in Germany. “
As far as I know , the foundation currently holds just 5% of the total supply.
You can verify the current distribution of IOTA here
All statistics shown in the above website are dynamically recalculated after each milestone.
It’s true that early investors are holding most of the tokens. But don’t worry. Fair redistribution is slowly taking place naturally as is evident from the data obtained from the recent snapshots.
Read this post to understand this better .
Misconception : IOTA has no real world applications now. It’s all a dream.
Reality : The following links illustrate the real world applications that IOTA already has.
Lot more will follow.
For updates about the real world applications of IOTA, please follow the official Twitter account of iota.
Misconception : Byteball is a better technology than IOTA
Reality : IOTA has zero transaction fees. It has unlimited scalability (by unlimited I really mean unlimited ) . It is quantum secure. Byteball doesn’t have any of these features.
Misconception : Nobody will run IOTA full nodes as there are no incentives in running it.
Reality : Please go through this post first.
Also please visit #nodesharing channel in iota slack. Everyday lots of new nodesharing requests come in that channel from all over the world. IOTA transactions used to take hours many months back. Now they confirm in less than five minutes. This is because day by day the network is getting stronger because of new nodes being setup.
Misconception : IOTA wallets are not user friendly.
Truth : IOTA technology is in its infancy. The wallets may be a little unfriendly now . But newer and better wallets are getting developed as I write this . For example see this link.
Misconception : Many people have lost IOTA from their wallet. The coins just disappeared.
Reality : Nobody lost their IOTA tokens. There was a recent network upgrade and there was a step called ‘transitioning’ which had to be done mandatorily . Some people did not do it and thought that their IOTA disappeared. Details about transitioning can be read here
Misconception : IOTA transactions are not fast because withdrawals and deposits take a lot of time on Bitfinex. Sometimes when IOTA is withdrawn from Bitfinex, it doesn’t reach the wallet at all even after multiple reattachments.
Reality : The problem is not with IOTA transactions. Bitfinex has a high load of deposits and withdrawals. The delay is from the exchange’s end and not an inherent problem of IOTA network.
If your Bitfinex withdrawal did not reach your wallet even after multiple reattachments, please open a support ticket with Bitfinex. They will surely sort out your problem. I reiterate, such an issue is a Bitfinex issue and not an IOTA network issue. It’s pointless to blame IOTA for that.
Misconception : IOTA is only on a single exchange (Bitfinex) currently because it’s a shitcoin.
Reality : Most of the exchanges want to list IOTA .Also they are in touch with the developers for help regarding integration.However, IOTA is not another blockchain copy paste nor an ERC 20 token. Integrating IOTA takes a little time because the technology is entirely new. The developers have promised that within a few months, IOTA will be on many more exchanges.
Misconception : IOTA transactions are meant to be machine to machine only. Human to human transactions using IOTA won’t be as good as M2M
Reality : It’s true that the main focus of the IOTA developers is on the Internet of Things (IOT) and M2M transactions. However, this does not mean that IOTA cannot be used for human to human transactions. In fact , IOTA is ideal for H2H transactions also because it has zero transaction fee and also because micro/nano transactions are possible with IOTA.
Also read this to see how IOTA has almost all the properties of money.
Misconception : IOTA is centralised because of the ‘Coordinator‘
Reality : Read the following excerpt from this blog post by the developers.
“IOTA is currently in what should be considered a ‘transition period’ towards large scale deployment and standardization. Like Bitcoin, Ethereum and all other distributed consensus protocols before it, the IOTA network need an onboarding mechanism to provide 34% attack protection in its early days. Due to the unique underlying architecture of IOTA this takes the shape of a ‘Coordinator’. The ‘Coordinator’ or ‘Coo’ for short, is essentially training wheels for the network until the amount of organic activity on the ledger is sufficient to where it can evolve unassisted, at which point the Coo is permanently shut off. This does not mean that the IOTA ledger is currently in any way centralized, the network is 100% decentralized, every node verifies that the Coo is is not breaking consensus rules by creating iotas out of thin air or approving double-spendings. In fact any talented programmer could replace Coo logic in IRI with Random Walk Monte Carlo logic and go without its milestones right now, so technically even at present the Coo is entirely optional. The only role the Coordinator serves is to protect against attacks in this temporary infancy stage of the Tangle ledger, if we shut the Coo down the network would continue to evolve as it will in the future when it is unassisted by these ‘training wheels’.”
Misconception : IOTA costs almost one dollar each. Then how can it be used for micro and nano transactions ?
Reality : One dollar each (at the time of writing this article ) is the cost of one Mi ( Mega iota ) ie , 1000,000 iota .
IOTA has total fixed supply of 2 779 530 283 277 761 units with zero inflation.
This makes micro /nano transactions possible. Also the developers might introduce decimals in IOTA in the future (There were discussions regarding this) . That will make nano transactions even more convenient.
Misconception : IOTA network is not secure. Everyday, I hear terms like ‘Double spending attack’ , ‘ 51% attack’ , ‘ 34 % attack’ etc. One of these may destroy the network one fine morning and all my money will be lost forever.
Reality : IOTA network is very secure. Read this article carefully and all your fears will be gone.
Misconception : IOTA has a huge supply. Therefore it’s price won’t increase.
Reality : This misconception is due to a lack of understanding of the very basic principles of market dynamics. Read this article from investopedia illustrating the principle behind stock splits. After reading this, you will be very well aware that what matters is the market capitalisation and not the number of shares/tokens initially issued.
Tail piece : A silent revolution in distributed ledger technology is happening. Dont miss the chance to be a part of it.
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