IOTA is an alt coin that uses a completely different network technology from blockchain for its ledger. This allows IOTA to focus on secured interactions between IoT (Internet of Things) devices while providing dynamic scalability and zero fees.
How is IOTA able to do this and what is the infrastructure under IOTA that’s supporting it all? In this article, we’ll answer those questions and most importantly, how do you invest in IOTA.
What Is IOTA?
IOTA was founded in 2015 by the IOTA Foundation. The currency for IOTA is the MIOTA. IOTA provides an alternative method of transacting compared to other cryptocurrencies. Mainly in that it doesn’t use a blockchain.
The IOT in IOTA means Internet of Things. IOTA wants to provide a distributed ledger platform for IoT devices to communicate, share resources and store data without incurring fees.
IOTA Foundation is adding some big names to its board. Early this year (week of Jan. 21), it was announced that Volkswagen CDO Johann Jungwirth was added to the board.
Jungwirth sees great value in IOTA’s ability to secure transactions between IoT devices. He mentioned to Finance Magnates, “IOTA has the potential to set a standard for trusted machine-to-machine transactions, with its brilliant technology, it’s no question why mobility and technology companies as well as other key players in the industry are joining the Foundation.”
IOTA is ranked #11 on coinmarketcap.com. It has a current value of $2.47 and there are 2,779,530,283 MIOTA circulating.
How Is IOTA Different?
IOTA doesn’t use a blockchain platform. Instead, it uses The Tangle, which is a directed acyclic graph (DAG) technology. The Tangle is a distributed ledger that provides up to 1000 transactions per second, making it extremely fast compared to other cryptocurrencies. Check out this article on investing in Ripple to see how it compares.
The performance of IOTA will improve as more devices or nodes are added to The Tangle. This means The Tangle is very scalable. This is in direct contrast to many existing blockchain platforms, which get slower with more transactions and cost more per transaction.
There aren’t any miners on The Tangle, which is also the reason there are no fees. Without miners, how does IOTA secure its network? This is done through participation of users or devices. Each user’s device confirms two other transactions. These constant verifications provide ongoing validity of the network. Thus consensus is an intrinsic part of the network.
IOTA’s network supports the smallest of IoT devices. This allows for micro transactions, leading to an overall lightweight network.
How To Invest In IOTA
There are more exchanges coming in the near future that will allow you to buy IOTA. For now, we’ll have to use Binance.
Let’s walk through the process in detail.
1. Create A Binance Account
The first thing you need to do is setup a Binance account.
Binance is a popular choice because it allows crypto-to-crypto transactions from companies like Coinbase. It's important to note that you can't send money to Binance. You have to go to Coinbase -> Exchange (Binance) -> IOTA.
So, you’ll always need two accounts:
Binance: which you can signup for here
Hopefully, this changes soon, but that's how it goes today.
2. Buy Bitcoin or Ether on Coinbase
Once you have a Binance account setup, you need to buy Bitcoin or Ether on Coinbase.
It's very easy to do once you have a Coinbase account setup. You simply go to the Buy/Sell page and enter your information. Then, your Bitcoin will be in your wallet and you can move to step 3.
3. Transfer Your Bitcoin To Binance
Once you have your Bitcoin or Ether in your Coinbase account, you can transfer it over to Binance. This is also fairly easy to do.
In your Binance account, go to your balances then wallets and you can see all the different coins you can hold in your account.
In our case, we're transferring over Bitcoin, so click on Bitcoin, and you'll see a Wallet Address generate. Here's what most look like:
Once you have that address, you go back to Coinbase, choose “Accounts”, and then “Send.” You'll see this screen come up where you can send your Bitcoin to the address generated in Binance:
4. Buy IOTA
Once you have your Bitcoin in your account at Binance, you can finally buy IOTA.
In your Binance account, execute the IOTA/BTC (or IOTA/ETH) exchange.
Once you place your trade, it will show up in your Binance account.
IoT devices are exploding in growth. Forbes forecast that the global IoT market will grow from $157B in 2016 to $457B by 2020. IOTA stands poised to benefit directly from that growth. Its infrastructure is already setup to scale as the IoT market scales. It’s certainly not too late to invest in IOTA, as there is still plenty of upside in the IoT market.
But remember, investing in any cryptocurrency is extremely speculative. You're betting on the price – that's it. You're hoping that the price will rise and someone else will pay you more in the future. However, you could also lose it all as well.
If you're not sure about using a digital wallet and this whole process, and want to invest via an ETF, you can't do it yet. However, there is a Bitcoin ETF – GBTC, and you can invest in it for as little as $5 on Stockpile. We'll give you $5 for free when you sign up for Stockpile through this link.
Let us know your thoughts on IOTA in the comments!