View source for IOTA (technology)

{{Short description|Open-source distributed ledger and cryptocurrency}}
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{{Use dmy dates|date=March 2018}}
{{infobox cryptocurrency
| currency_name = IOTA
| image_1 = Iota logo.svg
| image_2 = 
| image_title_1 = 
| superunit_ratio_1 = 
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| alt1 = Official IOTA logo
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| plural = IOTAs
| symbol = 
| ticker_symbol = IOTA
| coin_definition = 
| implementations = 
| initial_release_version = 
| initial_release_date = {{Start date and age|df=yes|2016|7|11}}
| code_repository = https://github.com/iotaledger
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| white_paper = {{Cite web|url= http://www.tangleblog.com/wp-content/uploads/2016/11/IOTA_Whitepaper.pdf |title=April 3, 2016. Version 0.6|last=Popov|first=Serguei |date=3 April 2016|archive-url=https://web.archive.org/web/20200814021738/http://www.tangleblog.com/wp-content/uploads/2016/11/IOTA_Whitepaper.pdf|archive-date=14 August 2020}}
| source_model = Open source
| license = 
| website = {{URL|iota.org}}
| block_explorer = {{URL|thetangle.org}}
| ledger_start = 
| split_date = 
| ledger_genesis = 
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| hash_function = Ed25519
| circulating_supply = 
| supply_limit = 2,779,530,283,277,761
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| total_supply = 2,779,530,283,277,761
| exchange_rate = 
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}}'''IOTA''' is{{Update after|2025}} an open-source [[distributed ledger]] and [[cryptocurrency]] designed for the [[Internet of things|Internet of things (IoT)]].<ref name=":132">{{Cite news|last=Morenne|first=Benoit|date=2021-04-07|title=Machines That Shop for Themselves Promise to Save Time and Money|language=en-US|work=Wall Street Journal|url=https://www.wsj.com/articles/machines-that-shop-for-themselves-promise-to-save-time-and-money-11617807664|access-date=2021-04-24|issn=0099-9660|archive-date=28 April 2021|archive-url=https://web.archive.org/web/20210428171208/https://www.wsj.com/articles/machines-that-shop-for-themselves-promise-to-save-time-and-money-11617807664|url-status=live}}</ref> It uses a [[directed acyclic graph]] to store transactions on its ledger, motivated by a potentially higher scalability over [[blockchain]] based distributed ledgers.<ref name=":1">{{Cite web|last=Anadiotis|first=George|date=2017-11-30|title=A better blockchain: Bitcoin for nothing and transactions for free?|url=https://www.zdnet.com/article/a-better-blockchain-bitcoin-for-nothing-and-transactions-for-free/|access-date=2020-01-15|website=ZDNet|language=en|archive-date=1 July 2022|archive-url=https://web.archive.org/web/20220701123829/https://www.zdnet.com/article/a-better-blockchain-bitcoin-for-nothing-and-transactions-for-free/|url-status=live}}</ref> IOTA does not use [[Cryptocurrency mining|miners]] to validate transactions, instead, nodes that issue a new transaction on the network must approve two previous transactions.<ref name=":10" /> Transactions can therefore be issued without fees, facilitating [[microtransaction]]s.<ref name=":10" /> The network currently{{As of when|date=July 2021}} achieves consensus through a coordinator node, operated by the IOTA Foundation.<ref name=":222">{{Cite journal|last1=Cao|first1=Bin|last2=Li|first2=Yixin|last3=Zhang|first3=Lei|last4=Zhang|first4=Long|last5=Mumtaz|first5=Shahid|last6=Zhou|first6=Zhenyu|last7=Peng|first7=Mugen|date=2019-07-10|title=When Internet of Things Meets Blockchain: Challenges in Distributed Consensus|journal=IEEE Network|volume=33|issue=6|pages=133–139|arxiv=1905.06022|bibcode=2019arXiv190506022C|doi=10.1109/MNET.2019.1900002|s2cid=108368043|issn=1558-156X}}</ref> As the coordinator is a single point of failure, the network is currently{{As of when|date=July 2021}} centralized.<ref name=":197">{{Cite web|last=Mix|date=2019-05-28|title=IOTA wants to ditch its most centralized component, but the timeline is still murky|url=https://thenextweb.com/hardfork/2019/05/28/iota-blockchain-cryptocurrency-decentralized/|access-date=2020-01-17|website=Hard Fork {{!}} The Next Web|language=en-us|archive-date=24 September 2019|archive-url=https://web.archive.org/web/20190924021232/https://thenextweb.com/hardfork/2019/05/28/iota-blockchain-cryptocurrency-decentralized/|url-status=live}}</ref>{{Update after|2022}}

IOTA has been criticized due to its unusual design, of which it is unclear whether it will work in practice.<ref name=":11224">{{Cite journal|last1=Heilman|first1=Ethan|last2=Narula|first2=Neha|last3=Tanzer|first3=Garrett|last4=Lovejoy|first4=James|last5=Colavita|first5=Michael|last6=Virza|first6=Madars|last7=Dryja|first7=Tadge|date=2019|title=Cryptanalysis of Curl-P and Other Attacks on the IOTA Cryptocurrency|journal=Cryptology ePrint Archive|url=https://eprint.iacr.org/2019/344|access-date=1 February 2020|archive-date=15 January 2020|archive-url=https://web.archive.org/web/20200115202343/https://eprint.iacr.org/2019/344|url-status=live}}</ref><ref name=":11">{{Cite web|last=Anadiotis|first=George|title=IOTA still wants to build a better blockchain and get it right this time|url=https://www.zdnet.com/finance/blockchain/iota-still-wants-to-build-a-better-blockchain-and-get-it-right-this-time/|access-date=2021-04-24|website=ZDNet|language=en|archive-date=13 April 2021|archive-url=https://web.archive.org/web/20210413114653/https://www.zdnet.com/article/iota-still-wants-to-build-a-better-blockchain-and-get-it-right-this-time/|url-status=live}}</ref> As a result, IOTA was rewritten from the ground up for a network update called Chrysalis, or IOTA 1.5, which launched on 28 April 2021.<ref name=":11" /> In this update, controversial decisions such as ternary encoding and quantum proof cryptography were left behind and replaced with established standards.<ref name=":11" /> A testnet for a follow-up update called Coordicide, or IOTA 2.0, was deployed in late 2020, with the aim of releasing a distributed network that no longer relies on the coordinator for consensus in 2021.<ref name=":197" /><ref name=":11" /><ref name=":8">{{Cite web|last=Riesbeck|first=Peter|date=2020-08-15|title=Moneten für Maschinen - Warum Dominik Schiener die Kryptowährung Iota entwickelt|url=https://www.fr.de/zukunft/storys/technologie/moneten-fuer-maschinen-warum-dominik-schiener-die-kryptowaehrung-iota-entwickelt-90023851.html|access-date=2021-01-02|website=Frankfurter Rundschau|language=de|archive-date=2 March 2021|archive-url=https://web.archive.org/web/20210302120550/https://www.fr.de/zukunft/storys/technologie/moneten-fuer-maschinen-warum-dominik-schiener-die-kryptowaehrung-iota-entwickelt-90023851.html|url-status=live}}</ref>{{Update after|2022}}

== History ==

The value transfer protocol IOTA, named after the smallest letter of the Greek alphabet, was created in 2015 by David Sønstebø, Dominik Schiener, Sergey Ivancheglo, and Serguei Popov.<ref name=":132" /><ref name=":12">{{Cite web|url=https://www.bloomberg.com/news/articles/2018-03-07/22-year-old-behind-5b-cryptocurrency-is-just-getting-started|title=22-Year-Old Behind $5 Billion Crypto Is Just Getting Started|last=Kahl|first=Stephan|date=2018-03-07|website=Bloomberg|access-date=7 March 2018|archive-date=7 March 2018|archive-url=https://web.archive.org/web/20180307160015/https://www.bloomberg.com/news/articles/2018-03-07/22-year-old-behind-5b-cryptocurrency-is-just-getting-started|url-status=live}}</ref> Initial development was funded by an online public crowdsale, with the participants buying the IOTA value token with other digital currencies.<ref name=":1" /> Approximately 1300{{nbsp}}[[bitcoin|BTC]] were raised, corresponding to approximately US$500,000 at that time, and the total token supply was distributed pro-rata over the initial investors. The IOTA network went live in 2016.<ref name=":02">{{Cite news|url=https://www.reuters.com/article/us-blockchain-iota-cisco-idUSKBN1DS2EE|title=Blockchain network IOTA teams up with Microsoft, others on data marketplace|last=Chavez-Dreyfuss|first=Gertrude|date=2017-11-28|work=Reuters|access-date=2020-01-15|language=en|archive-date=5 May 2020|archive-url=https://web.archive.org/web/20200505073015/https://www.reuters.com/article/us-blockchain-iota-cisco-idUSKBN1DS2EE|url-status=live}}</ref>

=== IOTA foundation ===
In 2017, early IOTA token investors donated 5% of the total token supply for continued development and to endow what became later became the IOTA Foundation.<ref name=":1" /> In 2018, the IOTA Foundation was chartered as a [[Stiftung]] in Berlin, with the goal to assist in the research and development, education and standardisation of IOTA technology.<ref>{{Cite web|url=https://www.die-stiftung.de/nachrichten-service/kurzmeldungen/iota-erste-krypto-stiftung-deutschlands-gegruendet-74566/|title=IOTA: Erste Krypto-Stiftung Deutschlands gegründet|date=2017-11-15|website=DIE STIFTUNG|language=de-DE|access-date=2020-01-15|archive-date=7 August 2019|archive-url=https://web.archive.org/web/20190807022149/https://www.die-stiftung.de/nachrichten-service/kurzmeldungen/iota-erste-krypto-stiftung-deutschlands-gegruendet-74566/|url-status=live}}</ref> The IOTA Foundation is a board member of International Association for Trusted Blockchain Applications (INATBA),<ref>{{Cite web|url=https://venturebeat.com/2019/04/03/eu-launches-blockchain-association-to-accelerate-distributed-ledger-technology-adoption/|title=EU launches blockchain association to accelerate distributed ledger technology adoption|last=O'Brien|first=Chris|date=2019-04-03|website=VentureBeat|language=en-US|access-date=2020-01-17|archive-date=4 July 2022|archive-url=https://web.archive.org/web/20220704032718/https://venturebeat.com/2019/04/03/eu-launches-blockchain-association-to-accelerate-distributed-ledger-technology-adoption/|url-status=live}}</ref> and founding member of the Trusted IoT Alliance<ref name=":0">{{Cite web|url=https://www.zdnet.com/article/new-alliance-promotes-the-blockchain-to-improve-iot-security-trust/|title=New alliance advocates the blockchain to improve IoT security, trust|last=Osborne|first=Charlie|date=2017-09-19|website=ZDNet|language=en|access-date=2020-01-17|archive-date=4 July 2022|archive-url=https://web.archive.org/web/20220704032712/https://www.zdnet.com/article/new-alliance-promotes-the-blockchain-to-improve-iot-security-trust/|url-status=live}}</ref> and Mobility Open Blockchain Initiative (MOBI),<ref>{{Cite web|url=https://techcrunch.com/2018/05/02/the-mobility-open-blockchain-initiative-bmw-gm-ford-renault/|title=BMW, GM, Ford and Renault launch blockchain research group for automotive industry|last=Russel|first=Jon|date=2018-05-02|website=TechCrunch|language=en-US|access-date=2020-02-01}}</ref> to promote blockchain and distributed ledgers in regulatory approaches, the IoT ecosystem and mobility.

Following a dispute between  IOTA founders David Sønstebø and Sergey Ivancheglo, Ivancheglo resigned from the board of directors on 23 June 2019.<ref>{{Cite web|last=Stanley Hunter|first=John|date=2020-02-20|title=Hacks und Streit unter Gründern: Was ist bei IOTA los?|url=https://www.capital.de/wirtschaft-politik/hacks-und-streit-unter-gruendern-was-ist-bei-iota-los|access-date=2021-01-02|website=Capital|language=de-DE|archive-date=4 July 2022|archive-url=https://web.archive.org/web/20220704032715/https://www.capital.de/wirtschaft-politik/hacks-und-streit-unter-gruendern-was-ist-bei-iota-los|url-status=live}}</ref><ref>{{Cite web|last=Come-from-Beyond|date=2020-02-03|title=My side of the story about parting ways with David Sønstebø|url=https://medium.com/@comefrombeyond/my-side-of-the-story-about-parting-ways-with-david-s%C3%B8nsteb%C3%B8-ab8d2c103c37|access-date=2021-01-03|website=Medium|language=en|archive-date=8 January 2021|archive-url=https://web.archive.org/web/20210108104110/https://medium.com/@comefrombeyond/my-side-of-the-story-about-parting-ways-with-david-s%C3%B8nsteb%C3%B8-ab8d2c103c37|url-status=live}}</ref><ref>{{Cite web|date=2019-07-26|title=Sergey Ivancheglo departs from the IOTA Foundation|url=http://blog.iota.org/sergey-ivancheglo-departs-from-the-iota-foundation-d2d9c1c61db6|access-date=2021-01-03|website=IOTA Foundation Blog|language=en|archive-date=22 January 2021|archive-url=https://web.archive.org/web/20210122025216/https://blog.iota.org/sergey-ivancheglo-departs-from-the-iota-foundation-d2d9c1c61db6/|url-status=live}}</ref> On 10 December 2020 the IOTA Foundation Board of Directors and supervisory board announced that the Foundation officially parted ways with David Sønstebø.<ref>{{Cite web|date=2020-12-10|title=IOTA Foundation parts ways with David Sønstebø|url=http://blog.iota.org/iota-foundation-parts-ways-with-david-sonstebo/|access-date=2021-01-02|website=IOTA Foundation Blog|language=en|archive-date=18 January 2021|archive-url=https://web.archive.org/web/20210118015655/https://blog.iota.org/iota-foundation-parts-ways-with-david-sonstebo/|url-status=live}}</ref><ref>{{Cite web|last=Sønstebø|first=David|date=2020-12-23|title=My departure has been greatly exaggerated|url=https://medium.com/@DavidSonstebo/my-departure-has-been-greatly-exaggerated-765850042e89|access-date=2021-01-02|website=Medium|language=en|archive-date=4 July 2022|archive-url=https://web.archive.org/web/20220704032856/https://medium.com/@DavidSonstebo/my-departure-has-been-greatly-exaggerated-765850042e89|url-status=live}}</ref>

In November 2023, the IOTA Ecosystem DLT Foundation was created in the United Arab Emirates. The purpose of the foundation is to facilitate the growth of IOTA's distributed ledger technology in the Middle East. It was the first crypto-centric organization to be approved by regulators of the [[Abu Dhabi Global Market]].<ref>{{cite web |last1=Chavez-Dreyfuss |first1=Gertrude |title=IOTA launches $100 million entity in Abu Dhabi to create digital network |url=https://www.reuters.com/technology/iota-launches-100-million-entity-abu-dhabi-create-digital-network-2023-11-29/ |website=www.reuters.com |date=November 29, 2023}}</ref> Later in 2024, IOTA was certified as a [[Sharia]]-compliant company.<ref>{{cite web |last1=Yaqub |first1=Aamer |title=How Sharia-Compliant Banking and Digital Identity are Advancing in Kenya and Somalia |url=https://www.halaltimes.com/how-sharia-compliant-banking-and-digital-identity-are-advancing-in-kenya-and-somalia/ |website=www.halaltimes.com |date=August 12, 2024}}</ref>

In 2024, the Imperial IOTA Infrastructures Lab (otherwise known as the I<sup>3</sup>-Lab) at [[Imperial College London]] was launched. The IOTA Foundation committed £1 million to the lab while Imperial College London provided additional funding. The I<sup>3</sup>-Lab focuses on [[circular economy]] research, sustainable business models, and [[translational research]] based on IOTA's technology.<ref>{{cite web |last1=Johnson |first1=Oliver |title=Imperial IOTA Infratructures Lab launches at Imperial College London |url=https://www.med-technews.com/news/latest-medtech-news/imperial-iota-infratructures-lab-launches-at-imperial-college-london/ |website=www.med-technews.com |date=July 4, 2024}}</ref>

=== DCI vulnerability disclosure ===
On 8 September 2017, researchers Ethan Heilman from [[Boston University]] and Neha Nerula et al. from [[Massachusetts Institute of Technology|MIT]]'s Digital Currency Initiative (DCI) reported on potential security flaws with IOTA's former Curl-P-27 hash function.<ref name=":11224" /> The IOTA Foundation received considerable backlash in their handling of the incident.<ref name=":1332">{{Cite web|last=Daniel Oberhaus & Jordan Pearson|date=2018-03-02|title=A $5 Billion Cryptocurrency Has Enraged Cryptographers|url=https://www.vice.com/en_us/article/ywq44k/a-5-billion-cryptocurrency-iota-has-enraged-cryptographers-leaked-emails|access-date=2020-01-21|website=Vice|language=en|archive-date=18 May 2019|archive-url=https://web.archive.org/web/20190518052455/https://www.vice.com/en_us/article/ywq44k/a-5-billion-cryptocurrency-iota-has-enraged-cryptographers-leaked-emails|url-status=live}}</ref> [[FT Alphaville]] reported legal posturing by an IOTA Founder against a security researcher for his involvement in the DCI report, as well as instances of aggressive language levelled against a Forbes contributor and other unnamed journalists covering the DCI report.<ref name=":1622">{{Cite web|last=Kelly|first=Jemima|date=2018-08-25|title=FUD, inglorious FUD|url=https://ftalphaville.ft.com/2018/04/25/1524628801000/FUD--inglorious-FUD/|access-date=2020-01-21|website=ftalphaville.ft.com|archive-date=5 May 2019|archive-url=https://web.archive.org/web/20190505211924/https://ftalphaville.ft.com/2018/04/25/1524628801000/FUD--inglorious-FUD/|url-status=live}}</ref> The Center for Blockchain Technologies at the [[University College London]] severed ties with the IOTA Foundation due to legal threats against security researchers involved in the report.<ref>{{Cite web|last=Mix|date=2018-04-28|title=University College London (UCL) severs ties with IOTA Foundation|url=https://thenextweb.com/hardfork/2018/04/28/iota-university-college-london-ucl/|access-date=2020-01-18|website=Hard Fork {{!}} The Next Web|language=en-us|archive-date=6 May 2019|archive-url=https://web.archive.org/web/20190506101121/https://thenextweb.com/hardfork/2018/04/28/iota-university-college-london-ucl/|url-status=live}}</ref>

=== Attacks ===
As a speculative blockchain and cryptocurrency-related technology, IOTA has been the target of [[phishing]], [[scamming]], and [[Security hacker|hacking]] attempts, which have resulted in the thefts of user tokens and extended periods of downtime.<ref name=":62">{{Cite web|last=Marcel Rosenbach, Markus Böhm|date=2018-01-30|title=Betrugsmaschen bei Kryptowährungen: Auf einmal ist alles weg|url=https://www.spiegel.de/netzwelt/web/bitcoin-iota-und-co-diese-betrugsmaschen-gibt-es-a-1190296.html|access-date=2020-01-15|website=www.spiegel.de|language=de|archive-date=9 November 2020|archive-url=https://web.archive.org/web/20201109082115/https://www.spiegel.de/netzwelt/web/bitcoin-iota-und-co-diese-betrugsmaschen-gibt-es-a-1190296.html|url-status=live}}</ref><ref name="heise2020022722">{{Cite web|last=Kannenberg|first=Axel|date=2020-02-27|title=IOTA cryptocurrency: Million dollar credit stolen, no payments possible (translated)|url=https://www.heise.de/newsticker/meldung/Kryptowaehrung-IOTA-Guthaben-im-Millionenwert-gestohlen-Netzwerk-steht-still-4669122.html|access-date=2020-03-04|website=heise online|archive-date=4 March 2020|archive-url=https://web.archive.org/web/20200304111255/https://www.heise.de/newsticker/meldung/Kryptowaehrung-IOTA-Guthaben-im-Millionenwert-gestohlen-Netzwerk-steht-still-4669122.html|url-status=live}}</ref><ref>{{Cite web|last=Osborne|first=Charlie|date=7 December 2020|title=2020's worst cryptocurrency breaches, thefts, and exit scams|url=https://www.zdnet.com/article/2020s-worst-cryptocurrency-breaches-thefts-and-exit-scams/|access-date=2021-01-03|website=ZDNet|language=en|archive-date=7 January 2021|archive-url=https://web.archive.org/web/20210107132223/https://www.zdnet.com/article/2020s-worst-cryptocurrency-breaches-thefts-and-exit-scams/|url-status=live}}</ref> In January 2018, more than US$10 million worth of IOTA tokens were stolen from users that used a malicious online seed-creator, a password that protects their ownership of IOTA tokens.<ref name=":62" /> The seed-generator scam was the largest fraud in IOTA history to date, with over 85 victims.<ref name=":1022">{{Cite web|last=Cimpanu|first=Catalin|title=Europol arrests UK man for stealing €10 million worth of IOTA cryptocurrency|url=https://www.zdnet.com/article/europol-arrests-uk-man-for-stealing-eur10-million-worth-of-iota-cryptocurrency/|access-date=2020-01-15|website=ZDNet|language=en|archive-date=8 January 2020|archive-url=https://web.archive.org/web/20200108071101/https://www.zdnet.com/article/europol-arrests-uk-man-for-stealing-eur10-million-worth-of-iota-cryptocurrency/|url-status=live}}</ref> In January 2019, the UK and German law enforcement agencies arrested a 36-year-old man from Oxford, England believed to be behind the theft.<ref>{{Cite news|date=2019-01-23|title=Oxford man arrested over £8.7m cryptocurrency theft|language=en-GB|work=BBC News|url=https://www.bbc.com/news/uk-england-oxfordshire-46980658|access-date=2020-01-17}}</ref><ref name=":73">{{Cite news|last=Chavez-Dreyfuss|first=Gertrude|date=2019-01-30|title=IOTA says bulk of $11 million stolen tokens found, hacker worked alone|language=en|work=Reuters|url=https://www.reuters.com/article/us-crypto-currencies-crime-idUSKCN1PO2J5|access-date=2020-01-15|archive-date=13 March 2020|archive-url=https://web.archive.org/web/20200313204348/https://www.reuters.com/article/us-crypto-currencies-crime-idUSKCN1PO2J5|url-status=live}}</ref>

On 26 November 2019 a hacker discovered a vulnerability in a third-party payment service,{{r|heise2020022722}} provided by ''MoonPay'',<ref>{{Cite web |title=Trinity Attack Incident Part 1: Summary and next steps |url=https://blog.iota.org/trinity-attack-incident-part-1-summary-and-next-steps-8c7ccc4d81e8/ |archive-url=https://archive.today/20210510003202/https://blog.iota.org/trinity-attack-incident-part-1-summary-and-next-steps-8c7ccc4d81e8/ |date=21 Feb 2020 |archive-date=10 May 2021 |website=iota.org }}</ref> integrated in the mobile and desktop wallet managed by the ''IOTA Foundation''.<ref name="heise2020022722" /> The attacker compromised over 50 IOTA seeds, resulting in the theft of approximately US$2 Million worth in IOTA tokens.<ref name="heise2020022722" /> After receiving reports that hackers were stealing funds from user wallets, the IOTA Foundation shut down the coordinator on 12 February 2020.<ref name=":2422">{{Cite web|last=Cimpanu|first=Catalin|title=IOTA cryptocurrency shuts down entire network after wallet hack|url=https://www.zdnet.com/article/iota-cryptocurrency-shuts-down-entire-network-after-wallet-hack/|access-date=2020-02-29|website=ZDNet|language=en|archive-date=26 February 2020|archive-url=https://web.archive.org/web/20200226042338/https://www.zdnet.com/article/iota-cryptocurrency-shuts-down-entire-network-after-wallet-hack/|url-status=live}}</ref><ref name=":42">{{Cite web|last=Osborne|first=Charlie|title=Bisq Bitcoin exchange slams on the brakes after exploit of critical security flaw, crypto theft|url=https://www.zdnet.com/article/bisq-bitcoin-exchange-slams-on-the-breaks-following-exploit-of-critical-security-flaw/|access-date=2020-05-04|website=ZDNet|language=en|archive-date=23 January 2021|archive-url=https://web.archive.org/web/20210123201217/https://www.zdnet.com/article/bisq-bitcoin-exchange-slams-on-the-breaks-following-exploit-of-critical-security-flaw/|url-status=live}}</ref> This had the side-effect of effectively shutting down the entire IOTA cryptocurrency.<ref name=":2422" /> Users at-risk were given seven days to migrate their potentially compromised seed to a new seed, until 7 March 2020. The coordinator was restarted on 10 March 2020.<ref>{{Cite web|last=Kannenberg|first=Axel|date=2020-03-02|title=Nach Trinity-Hack: IOTA stellt Migrationstool für kompromittierte Seeds bereit|url=https://www.heise.de/newsticker/meldung/Nach-Trinity-Hack-IOTA-stellt-Migrationstool-fuer-kompromittierte-Seeds-bereit-4672296.html|access-date=2020-03-08|website=heise online|language=de|archive-date=5 March 2020|archive-url=https://web.archive.org/web/20200305120109/https://www.heise.de/newsticker/meldung/Nach-Trinity-Hack-IOTA-stellt-Migrationstool-fuer-kompromittierte-Seeds-bereit-4672296.html|url-status=live}}</ref>

=== IOTA 1.5 (Chrysalis) and IOTA 2.0 (Coordicide) ===
The IOTA network is currently{{As of when|date=July 2021}} centralized, a transaction on the network is considered valid if and only if it is referenced by a milestone issued by a node operated by the IOTA foundation called the coordinator.<ref name=":1" /> In 2019 the IOTA Foundation announced that it would like to operate the network without a coordinator in the future, using a two-stage network update, termed Chrysalis for IOTA 1.5 and Coordicide for IOTA 2.0.<ref name=":197" /><ref name="heise2020022722" /> The Chrysalis update went live on 28 April 2021, and removed its controversial design choices such as ternary encoding and Winternitz one-time signatures, to create an enterprise-ready blockchain solution. In parallel Coordicide is currently{{As of when|date=July 2021}} developed, to create a distributed network that no longer relies on the coordinator for consensus.<ref name=":197" /> A testnet of Coordicide was deployed late 2020, with the aim of releasing a final version in 2021.<ref name=":197" /><ref name=":11" /><ref name=":8" />{{Update after|2022}}

== Characteristics ==
[[File:Blockchain vs tangle bottleneck.png|thumb|Diagram comparing a traditional [[blockchain]] with a "tangle"]]

=== The Tangle ===
The Tangle is the moniker used to describe IOTAs [[directed acyclic graph]] (DAG) transaction settlement and data integrity layer.<ref name=":1" /> It is structured as a string of individual transactions that are interlinked to each other and stored through a network of node participants.<ref name=":15">{{Cite journal|last1=Ali|first1=Muhammad Salek|last2=Vecchio|first2=Massimo|last3=Pincheira|first3=Miguel|last4=Dolui|first4=Koustabh|last5=Antonelli|first5=Fabio|last6=Rehmani|first6=Mubashir Husain|date=2018-12-18|title=Applications of Blockchains in the Internet of Things: A Comprehensive Survey|journal=IEEE Communications Surveys & Tutorials|volume=21|issue=2|pages=1676–1717|doi=10.1109/COMST.2018.2886932|issn=1553-877X|doi-access=free}}</ref> The Tangle does not have miners validating transactions, rather, network participants are jointly responsible for transaction validation, and must confirm two transactions already submitted to the network for every one transaction they issue.<ref name=":21" /> Transactions can therefore be issued to the network at no cost, facilitating micropayments.<ref name=":21">{{Cite journal|last1=Makhdoom|first1=Imran|last2=Abolhasan|first2=Mehran|last3=Abbas|first3=Haider|last4=Ni|first4=Wei|date=2019-01-01|title=Blockchain's adoption in IoT: The challenges, and a way forward|journal=Journal of Network and Computer Applications|language=en|volume=125|pages=251–279|doi=10.1016/j.jnca.2018.10.019|hdl=10453/130183|s2cid=54525546|hdl-access=free}}</ref> To avoid spam, every transaction requires computational resources based on Proof of Work (PoW) algorithms, to find the answer to a simple cryptographic puzzle.<ref name=":5">{{Cite journal|last1=Hawig|first1=David|last2=Zhou|first2=Chao|last3=Fuhrhop|first3=Sebastian|last4=Fialho|first4=Andre S|last5=Ramachandran|first5=Navin|date=2019-06-14|title=Designing a Distributed Ledger Technology System for Interoperable and General Data Protection Regulation–Compliant Health Data Exchange: A Use Case in Blood Glucose Data|journal=Journal of Medical Internet Research|language=en|volume=21|issue=6|pages=e13665|doi=10.2196/13665|issn=1438-8871|pmc=6595943|pmid=31199293 |doi-access=free }}</ref>

IOTA supports both value and data transfers.<ref name=":10" /> A second layer protocol provides encryption and authentication of messages, or data streams, transmitted and stored on the Tangle as zero-value transactions.<ref name=":5" /> Each message holds a reference to the address of a follow-up message, connecting the messages in a data stream, and providing [[forward secrecy]].<ref name=":5" /> Authorised parties with the correct decryption key can therefore only follow a datastream from their point of entry.<ref name=":5" /> When the owner of the data stream wants to revoke access, it can change the decryption key when publishing a new message.<ref name=":5" /> This provides the owner granular controls over the way in which data is exchanged to authorised parties.<ref name=":5" />

=== IOTA token ===
The IOTA token is a unit of value in the IOTA network.<ref name=":2">{{Cite web|url=https://www.spiegel.de/spiegel/kryptowaehrung-bitcoin-geht-blockchain-bleibt-a-1189154.html|title=Kryptowährung: Bitcoin geht, Blockchain bleibt|last=Marcel Rosenbach, Alexander Jung, Frank Dohmen|date=2018-01-22|website=www.spiegel.de|language=de|access-date=2020-01-15|archive-date=19 March 2020|archive-url=https://web.archive.org/web/20200319083300/https://www.spiegel.de/spiegel/kryptowaehrung-bitcoin-geht-blockchain-bleibt-a-1189154.html|url-status=live}}</ref> There is a fixed supply of 2,779,530,283,277,761 IOTA tokens in circulation on the IOTA network. IOTA tokens are stored in IOTA wallets protected by an 81-character seed, similar to a password.<ref name=":73" /> To access and spend the tokens, IOTA provides a cryptocurrency wallet.<ref name=":11" /><ref name=":62" /> A hardware wallet can be used to keep credentials offline while facilitating transactions.<ref name=":73" />

===Coordinator node===
IOTA currently{{As of when|date=July 2021}} requires a majority of honest actors to prevent network attacks.<ref name=":1" /> However, as the concept of mining does not exist on the IOTA network, it is unlikely that this requirement will always be met. Therefore, consensus is currently{{As of when|date=July 2021}} obtained through referencing of transactions issued by a special node operated by the IOTA foundation, called the coordinator.<ref name=":222" /> The coordinator issues zero value transactions at given time intervals, called milestones.<ref name=":222" /> Any transaction, directly or indirectly, referenced by such a milestone is considered valid by the nodes in the network. The coordinator is an authority operated by the IOTA foundation and as such single point of failure for the IOTA network, which makes the network centralized.<ref name=":197" />

=== Markets ===
IOTA is traded in [[Mega-|mega]]IOTA units (1,000,000 IOTA) on [[digital currency exchange]]s such as [[Bitfinex]], and listed under the MIOTA [[ticker symbol]].<ref>{{Cite web|url=https://www.cnbc.com/2017/06/14/major-bitcoin-exchanges-hit-by-cyberattacks-as-record-rally-makes-them-a-target.html|title=Major bitcoin exchanges hit by cyberattacks as record rally makes them a target|last=Cheng|first=Evelyn|date=2017-06-14|website=CNBC|language=en|access-date=2020-01-17|archive-date=14 May 2019|archive-url=https://web.archive.org/web/20190514131914/https://www.cnbc.com/2017/06/14/major-bitcoin-exchanges-hit-by-cyberattacks-as-record-rally-makes-them-a-target.html|url-status=live}}</ref> Like other digital currencies, IOTA's token value has soared and fallen.<ref name=":3">{{Cite news|url=https://www.economist.com/science-and-technology/2018/03/28/new-ways-to-trade-data|title=New ways to trade data, New ways to trade data|date=2018-03-28|newspaper=The Economist|access-date=2020-01-15|issn=0013-0613|archive-date=15 January 2020|archive-url=https://web.archive.org/web/20200115193438/https://www.economist.com/science-and-technology/2018/03/28/new-ways-to-trade-data|url-status=live}}</ref><ref>{{Cite web|url=https://www.bloomberg.com/news/articles/2019-05-14/bitcoin-adds-market-share-as-crypto-winter-turns-glorious-summer|title=Bitcoin Adds Market Share in Recovery in Crypto Prices|last=Kharif|first=Olga|date=2019-05-14|website=Bloomberg|access-date=2020-01-18|archive-date=1 January 2020|archive-url=https://web.archive.org/web/20200101083321/https://www.bloomberg.com/news/articles/2019-05-14/bitcoin-adds-market-share-as-crypto-winter-turns-glorious-summer|url-status=live}}</ref><ref name=":72">{{Cite web|url=https://www.forbes.com/sites/oliversmith/2018/08/16/how-next-generation-crypto-investors-are-poised-to-win-even-if-their-startups-lose/|title=How Next Generation Crypto Investors Are Poised To Win, Even If Their Startups Lose|last=Smith|first=Oliver|date=2018-08-16|website=Forbes|language=en|access-date=2020-01-15|archive-date=7 May 2020|archive-url=https://web.archive.org/web/20200507203303/https://www.forbes.com/sites/oliversmith/2018/08/16/how-next-generation-crypto-investors-are-poised-to-win-even-if-their-startups-lose/|url-status=live}}</ref>

=== Fast Probabilistic Consensus (FPC) ===

The crux of cryptocurrencies is to stop [[Double-spending|double spends]], the ability to spend the same money twice in two simultaneous transactions. Bitcoin's solution has been to use Proof of Work (PoW) making it a significant financial burden to have a minted block be rejected for a double spend. IOTA has designed a voting algorithm called Fast Probabilistic Consensus to form a consensus on double spends.<ref>{{Cite journal|last=Popov|first=Serguei|title=FPC-BI: Fast Probabilistic Consensus within Byzantine Infrastructures|journal=Preprint|year=2021|volume=147|pages=77–86|doi=10.1016/j.jpdc.2020.09.002|issn=0743-7315|arxiv=1905.10895|s2cid=198179629}}</ref> Instead of starting from scratch, the IOTA Foundation started with Simple Majority Consensus where the first opinion update is defined by,

<math>s_i(1) = \begin{cases}1 & \mu_i(1) \geq \tau\\0 & \text{otherwise} \end{cases}
</math>

Where <math>s_i(\cdot)</math> is the opinion of node <math>i</math> at time <math>1</math>. The function <math>\mu_i(1)</math> is the percent of all the nodes that have the opinion <math>1</math> and <math>\tau \in (0.5,1] </math> is the threshold for majority, set by the implementation. After the first round, the successive opinions change at time <math>t</math> to the function,

<math>s_i(t+1) = \begin{cases}1 & \mu_i(t+1) > 0.5 \\0 & \mu_i(t+1) < 0.5 \\ s_i(t) & \text{otherwise}\end{cases}
</math>

Although, this model is fragile against malicious attackers which is why the IOTA Foundation decided not to use it.<ref>I. Benjamin, S.-O. Chan, R. O'Donnel, O. Tamuz, L.-Y. Tan, Convergence, unanimity and disagreement in majority dynamics on unimodular graphs and random graphs, Stochastic Processes and their Applications 126 (9) (2016) 2719-2733.</ref> Instead the IOTA Foundation decided to augment the leaderless consensus mechanism called, ''Random neighbors majority consensus (RMC)'' which is similar to SMC although, the nodes in which their opinions are queries is randomized. They took RMC then augmented it to create FPC by having the threshold of majority be a random number generated from a Decentralized Random Number Generator (dRNG). For FPC, the first sound is the same,

<math>s_i(1) = \begin{cases}1 & \mu_i(1) \geq \tau\\0 & \text{otherwise} \end{cases}
</math>

For success rounds though,

<math>s_i(t+1) = \begin{cases}1 & \mu_i(t+1) > U_t \\0 & \mu_i(t+1) < U_t \\ s_i(t) & \text{otherwise}\end{cases}
</math>

Where <math>U_t \sim \textbf{U}(\beta,1-\beta)</math> where <math>\beta \in [0,1/2]</math>, is a randomized threshold for majority. Randomizing the threshold for majority makes it extremely difficult for adversaries to manipulate the consensus by either making it converge to a specific value or prolonging consensus. Note that FPC is only utilized to form consensus on a transaction during a double spend.<ref>Capossele, Angelo, Sebastian Müller, and Andreas Penzkofer. "Robustness and efficiency of leaderless probabilistic consensus protocols within Byzantine infrastructures." ''arXiv preprint arXiv:1911.08787'' (2019).</ref>

Ultimately, IOTA uses Fast Probabilistic Consensus for consensus and uses Proof of Work as a rate controller.<ref>{{Cite web|last=Sanders|first=William|date=19 Mar 2021|title=Explaining the IOTA Congestion Control Algorithm|url=https://blog.iota.org/explaining-the-iota-congestion-control-algorithm/|access-date=19 May 2021|archive-date=19 May 2021|archive-url=https://web.archive.org/web/20210519215643/https://blog.iota.org/explaining-the-iota-congestion-control-algorithm/|url-status=live}}</ref> Because IOTA does not use PoW for consensus, its overall network and energy per transaction is extremely small.<ref>{{Cite web|last=Ramachandran|first=Navin|date=14 May 2021|title=Energy Benchmarks for the IOTA Network (Chrysalis Edition)|url=https://blog.iota.org/internal-energy-benchmarks-for-iota/|access-date=19 May 2021|archive-date=19 May 2021|archive-url=https://web.archive.org/web/20210519215644/https://blog.iota.org/internal-energy-benchmarks-for-iota/|url-status=live}}</ref>

== Applications and testbeds ==
Proof-of-concepts building on IOTA technology are being developed in the automotive and IoT industry by corporations, such as [[Jaguar Land Rover]], [[STMicroelectronics]] and [[Robert Bosch GmbH|Bosch]].<ref name=":3" /><ref>{{Cite web|last=O'Grady|first=Sean|date=2019-05-03|title=Mobile piggy bank: Jaguar Land Rover's 'earn as you drive' concept|url=https://www.independent.co.uk/life-style/motoring/jaguar-land-rover-smart-wallet-cryptocurrency-destination-zero-a8892541.html|access-date=2020-01-17|website=The Independent|language=en|archive-date=1 February 2020|archive-url=https://web.archive.org/web/20200201152011/https://www.independent.co.uk/life-style/motoring/jaguar-land-rover-smart-wallet-cryptocurrency-destination-zero-a8892541.html|url-status=live}}</ref><ref>{{Cite news|last=Chavez-Dreyfuss|first=Gertrude|date=2020-09-30|title=Jaguar, NTT team up with tech group on remote access software|language=en|work=Reuters|url=https://www.reuters.com/article/us-blockchain-autos-jaguar-idUSKBN26L3JO|access-date=2021-01-03|archive-date=3 November 2020|archive-url=https://web.archive.org/web/20201103235923/https://www.reuters.com/article/us-blockchain-autos-jaguar-idUSKBN26L3JO|url-status=live}}</ref> IOTA is a participant in [[smart city]] testbeds, to establish digital identity, waste management and local trade of energy.<ref name=":132" /><ref>{{Cite web|last=O'Brien|first=Chris|date=2019-08-30|title=Norway unveils energy-positive building showcasing smart city potential|url=https://venturebeat.com/2019/08/30/norway-unveils-energy-positive-building-showcasing-smart-city-potential/|access-date=2020-01-17|website=VentureBeat|language=en-US|archive-date=3 December 2019|archive-url=https://web.archive.org/web/20191203014147/https://venturebeat.com/2019/08/30/norway-unveils-energy-positive-building-showcasing-smart-city-potential/|url-status=live}}</ref><ref>{{Cite web|last=Mix|date=2018-02-21|title=IOTA is vulnerable to replay attacks but has no intention of fixing the flaw|url=https://thenextweb.com/hardfork/2018/02/21/iota-replay-attacks-vulnerability/|access-date=2021-01-03|website=Hard Fork {{!}} The Next Web|language=en-us|archive-date=22 January 2021|archive-url=https://web.archive.org/web/20210122140000/https://thenextweb.com/hardfork/2018/02/21/iota-replay-attacks-vulnerability/|url-status=live}}</ref> In project Alvarium, formed under the Linux Foundation, IOTA is used as an immutable storage and validation mechanism.<ref>{{Cite web|last=Bantle|first=Ulrich|date=2019-10-31|title=Linux Foundation gründet Data-Privacy-Projekt Alvarium|url=https://www.linux-magazin.de/news/linux-foundation-gruendet-data-privacy-projekt-alvarium/|access-date=2020-01-25|website=Linux-Magazin|language=de-DE|archive-date=25 January 2020|archive-url=https://web.archive.org/web/20200125165046/https://www.linux-magazin.de/news/linux-foundation-gruendet-data-privacy-projekt-alvarium/|url-status=live}}</ref><ref>{{Cite web|last=Agelini|first=Chris|date=2020-01-23|title=How open, trusted edge can help improve data sharing and monetization|url=https://venturebeat.com/2020/01/23/how-open-trusted-edge-can-help-improve-data-sharing-and-monetization/|access-date=2020-01-25|website=VentureBeat|language=en-US|archive-date=25 January 2020|archive-url=https://web.archive.org/web/20200125165123/https://venturebeat.com/2020/01/23/how-open-trusted-edge-can-help-improve-data-sharing-and-monetization/|url-status=live}}</ref> The privacy centered search engine Xayn uses IOTA as a [[trust anchor]] for its aggregated [[Artificial intelligence|AI]] model.<ref>{{Cite web|last=Lomas|first=Natasha|title=Xayn is privacy-safe, personalized mobile web search powered by on-device AIs|url=https://techcrunch.com/2020/12/08/xayn-is-privacy-safe-personalized-mobile-web-search-powered-by-on-device-ais/|access-date=2021-01-03|website=TechCrunch|date=8 December 2020|language=en-US}}</ref><ref>{{Cite web|last=Voß|first=Oliver|date=9 December 2020|title=Suchmaschine mit Tinder-Prinzip|url=https://background.tagesspiegel.de/digitalisierung/suchmaschine-mit-tinder-prinzip|access-date=3 January 2021|website=Tagesspiegel|archive-date=21 January 2021|archive-url=https://web.archive.org/web/20210121092747/https://background.tagesspiegel.de/digitalisierung/suchmaschine-mit-tinder-prinzip|url-status=live}}</ref> In 2024, IOTA partnered with Eviden (an [[Atos]] Group company) to announce the Eviden Digital Passport Solution (EDPS), a distributed ledger technology-based service that tracks the life cycle and carbon footprint of automotive batteries (like the origin of the battery, materials used to create it, manufacturing process, usage, repairs, etc.), making a determination on their sustainability through that collection of data.<ref>{{cite web |last1=Nolan |first1=Stella |title=IOTA & Eviden Launch Digital Passport Solution |url=https://evmagazine.com/articles/iota-eviden-launch-digital-passport-solution |website=evmagazine.com |date=July 12, 2024}}</ref>

On 11 February 2020, the [[Eclipse Foundation]] and IOTA Foundation jointly launched the Tangle EE (Enterprise Edition) Working Group.<ref name=":10">{{Cite web|url=https://www.zdnet.com/article/the-tangle-or-blockchain-for-the-internet-of-things/|title=Enter the Tangle, a blockchain designed specially for the Internet of Things|last=McKendrick|first=Joe|website=ZDNet|language=en|access-date=2020-02-29|archive-date=27 February 2020|archive-url=https://web.archive.org/web/20200227212403/https://www.zdnet.com/article/the-tangle-or-blockchain-for-the-internet-of-things/|url-status=live}}</ref> Tangle EE is aimed at enterprise users that can take IOTA technology and enable larger organizations to build applications on top of the project, where the Eclipse Foundation will provide a vendor-neutral governance framework.<ref>{{Cite web|url=https://techcrunch.com/2020/02/11/tangle-ee-project-joins-eclipse-foundation-to-bring-distributed-ledger-apps-to-enterprise/|title=Tangle EE project joins Eclipse Foundation to bring distributed ledger apps to enterprise|last=Miller|first=Ron|date=2020-02-11|website=TechCrunch|language=en-US|access-date=2020-02-29}}</ref>

Announcements of partners were critically received.<ref name=":4">{{Cite web|last=Mix|date=2017-12-12|title=IOTA clarifies it has no formal partnership with Microsoft [UPDATED]|url=https://thenextweb.com/hardfork/2017/12/12/iota-partnership-microsoft-marketplace/|access-date=2020-01-15|website=Hard Fork {{!}} The Next Web|language=en-us|archive-date=18 December 2019|archive-url=https://web.archive.org/web/20191218183926/https://thenextweb.com/hardfork/2017/12/12/iota-partnership-microsoft-marketplace/|url-status=live}}</ref><ref name=":92">{{Cite web|last=Kaminska|first=Izabella|date=2019-05-28|title=Emperor has no clothes, Jaguar crypto press release edition|url=http://ftalphaville.ft.com/2019/05/28/1559050976000/Emperor-has-no-clothes--Jaguar-crypto-press-release-edition/|website=FT Alphaville|access-date=1 February 2020|archive-date=10 March 2020|archive-url=https://web.archive.org/web/20200310023347/https://ftalphaville.ft.com/2019/05/28/1559050976000/Emperor-has-no-clothes--Jaguar-crypto-press-release-edition/|url-status=live}}</ref> In 2017, IOTA released the data marketplace, a pilot for a market where connected sensors or devices can store, sell or purchase data.<ref>{{Cite web|last=Ponciano|first=Jonathan|title=IOTA Foundation Launches Data Marketplace For 'Internet-Of-Things' Industry|url=https://www.forbes.com/sites/jonathanponciano/2017/11/28/iota-foundation-launches-data-marketplace-for-internet-of-things-research/|access-date=2020-01-18|website=Forbes|language=en|archive-date=21 June 2018|archive-url=https://web.archive.org/web/20180621171222/https://www.forbes.com/sites/jonathanponciano/2017/11/28/iota-foundation-launches-data-marketplace-for-internet-of-things-research/|url-status=live}}</ref><ref>{{Cite web|date=2017-11-28|title=IOTA launches IoT data marketplace, envisions devices autonomously buying and trading information|url=https://venturebeat.com/2017/11/28/iota-launches-iot-data-marketplace-envisions-devices-autonomously-buying-and-trading-information/|access-date=2020-01-15|website=VentureBeat|language=en-US|archive-date=7 January 2020|archive-url=https://web.archive.org/web/20200107170926/https://venturebeat.com/2017/11/28/iota-launches-iot-data-marketplace-envisions-devices-autonomously-buying-and-trading-information/|url-status=live}}</ref> The data marketplace was received critically by the cryptocurrency community over the extent of the involvement of the participants of the data marketplace, suggesting that "the IOTA Foundation was actively asking publications to use Microsoft’s name following the data marketplace announcement.".<ref name=":4" /> Izabella Kaminska criticized a Jaguar press release: "our interpretation is that it's very unlikely Jaguar will be bringing a smart-wallet-enabled marketplace any time soon."<ref name=":92" />

== Criticism ==
IOTA promises to achieve the same benefits that blockchain-based DLTs bring {{mdash}} decentralization, distribution, immutability and trust {{mdash}} but removes the downsides of wasted resources associated with mining as well as transaction costs.<ref name=":1" /> However, several of the design features of IOTA are unusual, and it is unclear whether they work in practice.<ref name=":18">{{Cite web|url=https://techcrunch.com/2018/08/09/cryptocurrency-insecurity-iota-bcash-and-too-many-more/|title=Cryptocurrency insecurity: IOTA, BCash and too many more|last=Evans|first=Jon|date=2018-08-10|website=TechCrunch|language=en-US|access-date=2020-01-26}}</ref><ref name=":197" /><ref name=":11224" />

The security of IOTA's consensus mechanism against double-spending attacks is unclear, as long as the network is immature.<ref name=":15" /> Essentially, in the IoT, with heterogeneous devices having varying levels of low computational power, sufficiently strong computational resources will render the tangle insecure.<ref name=":15" /> This is a problem in traditional proof-of-work blockchains as well, however, they provide a much greater degree of security through higher fault tolerance and transaction fees.<ref name=":15" /> At the beginning, when there is a lower number of participants and incoming transactions, a central coordinator is needed to prevent an attack on the IOTA tangle.<ref name=":15" />

Critics have opposed the role of the coordinator for being the single source of consensus in the IOTA network. [[Polychain Capital]] founder [[Olaf Carlson-Wee]], says "IOTA is not decentralized, even though IOTA makes that claim, because it has a central "coordinator node" that the network needs to operate. If a regulator or a hacker shut down the coordinator node, the network would go down."<ref name=":442">{{Cite web|last=Kauflin|first=Jeff|date=2018-01-03|title=IOTA Rose 464% In 2017, But Buyer Beware: Experts Have Major Security Concerns|url=https://www.forbes.com/sites/jeffkauflin/2018/01/03/iota-rose-464-in-2017-but-buyer-beware-experts-have-major-security-concerns/#7656696b5faa|url-status=live|archive-url=https://web.archive.org/web/20190807022935/https://www.forbes.com/sites/jeffkauflin/2018/01/03/iota-rose-464-in-2017-but-buyer-beware-experts-have-major-security-concerns/|archive-date=7 August 2019|access-date=7 August 2019|website=Forbes}}</ref> This was demonstrated during the Trinity attack incident, when the IOTA foundation shutdown the coordinator to prevent further thefts.<ref name=":442" /><ref name="heise2020022722" /><ref name=":197" /> Following a discovered vulnerability in October 2017, the IOTA foundation transferred potentially compromised funds to addresses under its control, providing a process for users to later apply to the IOTA Foundation in order to reclaim their funds.<ref name=":11224" />

Additionally, IOTA has seen several network outages as a result of bugs in the coordinator as well as DDoS attacks.<ref name=":1" /> Early in the seed generator scam, a DDoS network attack distracted IOTA admins, leaving initial thefts undetected. 

In 2020, the IOTA Foundation announced that it would like to operate the network without a coordinator in the future, but implementation of this is still in an early development phase.<ref name="heise2020022722" /><ref name=":197" /><ref name=":11" />

== See also ==

* [[Nano (cryptocurrency)]]

== References ==
{{reflist}}

== External links ==
* [http://www.iota.org/ Official website]

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