What is IoTeX (IOTX): the next evolution of the data economy?
The sophisticated blockchain innovator believes a data-sharing democracy is long overdue
- What is the IoTeX coin?
- IoTex explained
- Is IoTeX an Ethereum dApp?
- How tokenomics works
- How burn drops work
- Web 3.0
- What is next for IoTeX?
All cryptocurrencies need to have a USP – unique selling point – if they are to have any chance of success. IoTeX is no exception, staking its claim on an ability to allow people to exchange personal data for rewards without that data being identified with them as individuals. So what is IoTeX (IOTX) and what is the iotex coin used for?
What is the IoTeX coin?
IOTX is the native token of the IoTeX blockchain, a California-based platform representing what it calls "the decentralisation of user-generated data", meaning that people control their own data, rather than giant corporations gaining ownership of it.
What is the IoTeX coin used for? As a utility token, this native IoTeX cryptocurrency has two primary purposes. First, token holders are granted voting power for the governance of the IoTeX network, called ‘staking’. Upgrades, blockchain forks and other system redesigns are executed via consensus among these token holders, and interest is paid out as a reward for participating.
The IOTX cryptocurrency is also what powers all dApps built on the IoTeX blockchain. Users spend IOTX to access these dApps and developers accept payments similarly.
The IOTX coin runs on deflationary economics (IoTeX calls it "burn drop tokenomics"), meaning IOTX tokens are airdropped to users after every new device is registered to the IoTeX network. This ensures that the value of IOTX will continue to climb as the IoTeX blockchain becomes more popular.
The current circulating supply of IOTX is 9.54 billion against a maximum supply of 10 billion. A current trading price of $0.18 gives a market capitalisation of $1.77bn. IOTX ranks as the 77th biggest cryptocurrency by market cap. (All figures sourced from CoinMarketCap.)
Check out our predictor or a further IoTeX review and what the forecasters have in mind for the IOTX coin performance.
If you are asking yourself: "How does IoTeX work?", the IOTX token is what underpins the IoTeX blockchain. IoTeX is what the people behind it claim is a cutting-edge combination of standard blockchain technology and the physical Pebble Tracker device, which is stacked with GPS, climate, motion and light-intensity sensors, giving a 360° data visualisation of an individual’s or asset’s environment.
Or, according to its white paper, it is a “decentralised network for internet of things (IoT) powered by a privacy-centric blockchain”. Breaking down these buzzwords into some possible real-world uses, perhaps a tourist attraction is giving away NFTs to anyone who visits within a certain time period. Rather than handing over your name, age, email address etc in order to receive your gift, your Pebble Tracker generates a smart contract via the blockchain, verifying a location and voila, the NFT is yours, without the tourist attraction having a single clue who you really are.
Another real-world possibility is the monetisation of crowd-sourced data sets, done in a democratic way. Take, for instance, Waze, a billion-dollar corporation built on the backs of user-generated GPS data, providing optimal travel routes and traffic updates. But what stake of the profit do users get from this revenue? None. Their only "reward" is pesky targeted advertisements.
The IoTeX blockchain, via anonymous smart contracts combined with the Pebble Tracker hardware, could potentially allow individuals to band together to sell massive data sets to willing buyers, while retaining 100% of the profits.
Pebble Tracker is already being test-used in supply chains. For instance, an IOTX payment can be automatically triggered once a payload reaches a certain destination. Does that payload, if it is something like chilled food, or even a vaccine, require, for example, certain temperature parameters to be maintained? Then a penalty or reward can be added to the payment depending on what the data transmits on the temperature status throughout the journey.
The possibilities are immense for this marrying of decentralised blockchain technnology and physical IoT hardware, but IoTeX is still in its early stages and much is still speculative.
In simplistic terms, IoTeX seeks to replace the likes of Google as a data broker, allowing data generators and data buyers to trade anonymously on the blockchain instead of profits from data-grabbing going straight into the pockets of mega corporations.
Will it succeed? That remains to be seen. If IoTeX envisions a world where every woman and her dog walks around with a Pebble Tracker hanging from their necks, they may be disappointed. And although case studies have shown the technology has potential in the supply chain, with a pre-order price tag of $215 per unit, there are questions of scalability for mid-sized companies.
Is IoTeX an Ethereum dApp?
No it is not. IoTeX is an open-source blockchain protocol built from the ground up. It supplies its own developer tools for the creation of IOTX-powered dApps.
It is, however, EVM-compatible, meaning users can port over Ethereum dApps and any crypto assets held on the Ethereum blockchain.
IoTeX claims that its blockchain executes transactions instantly and with ultra-low gas fees.
How tokenomics works
If you hold a bunch of IOTX, you can stake your tokens and reap the rewards. This works through a system called delegated proof of stake (DPoS).
Through the IOTX stake portal, you can choose from a list of delegates to stake your IOTX to, who will in turn exercise their voting rights determinate on the amount of IOTX held. Think of it as voting for your local MP, who will in turn head to parliament to (it is hoped) vote in your best interests.
These delegates incentivise stakers in different ways and while ultimately they are looking to make money, any failure to properly incentivise potential stakers will eventually see them kicked off the delegate list.
Theoretically, anyone can pitch to become a delegate. But as is typical of DPoS regimes, fortune favours those with superior processing power at their fingertips.
How burn drops work
As earlier mentioned, burn dropping is the process of maintaining IOTX value by reducing the total supply of the token over time.
There are 10 drop phases scheduled, tied to the amount of new devices connected to the IoTeX network. A grand total of one billion IOTX will be dropped as one million devices come onto the network. Phase one was triggered on 3 November, driven by purchases of IoTeX’s UCam product.
While 90% of these dropped IOTX tokens will go in the virtual bin, 100 million will be distributed among stakers as a reward for contributing to the network.
IoTeX considers itself the vanguard of the Web 3.0 (or Web3) movement. What exactly does that mean? Well, as with most blockchain technology, the endgame is to decentralise and democratise existing web and financial applications. In IoTeX’s case, the aim is to decentralise user data as shared throughout the IoT.
The small handful of giant tech corporations currently in control of most of the internet, Google, Amazon, Facebook, Apple and a few others, trillion-dollar conglomerates (apart from lowly Facebook, barely worth $950bn,) maintain full control of user data and the value generated by that data.
Web3 aims to change that. Through the power of blockchain’s peer-to-peer process, platforms such as IoTeX believe in a user-governed, decentralised and permissionless environment where all data and that data’s value is captured by users, not giant corporations.
What is next for IoTeX?
After a successful crowdfunding, the Pebble Tracker is due to be shipped to backers in early 2022.
Coupled with the existing UCam device available on Amazon, this will drive up the number of devices operating on the IoTeX network, therefore triggering the next round of burn-drop phases of IoTeX coin to existing stakers.
Confidence in the IoTeX (IOTX) token is likely to depend on the success of the Pebble Tracker rollout. Could IOTX smash the $1 ceiling and continue to climb the crypto ranks? We shall have to wait and see.
There is currently a circulating supply of 9.54 billion IOTX against a maximum supply of 10 billion.
IoTeX was co-founded by cryptography research scientist Raullen Chai, tech start-up investment expert Jing Sun, technical strategist Xinxin Fan and research scientist Qevan Guo.
IoTeX employs a large team of scientists and engineers at its San Francisco HQ.
You can buy IOTX at a range of crypto exchanges. We don’t have it at currency.com yet, but we will let you know if and when we do. Just remember to do your research and never invest more than you can afford to lose.