- The mass adoption of blockchain technology in the last decade has led to the proliferation of blockchain solutions and coins.
- IOTA, a distributed ledger to approve transactions in record time, has many utilities which it brings to DeFi.
- In an interview with DailyCoin, IOTA’s Dominic Shiner revealed the need for blockchain solutions to constantly provide utility instead of creating hype.
- Expert opinion points to the fact that creating hype around a valueless token hurts the market in the long run.
The success of Bitcoin led to the proliferation of altcoins. These coins and their blockchains like Ethereum, IOTA, etc offer several utilities. However, due to the buzz around crypto and DeFi, many valueless coins and solutions have sprung forth.
The team around these coins creates them to boost ‘shit coins’ through market manipulation. They use the fame of celebrities to create hype around the coin. A section of the interview we had with IOTA’s Dominic Shiner was centred on the struggle between creating value and hype among blockchain solutions and the effect it has on the market.
Utility v Hype: Dominic Shiner’s Perspective
IOTA is a “blockless blockchain”, a distributed ledger that authenticates transactions with no fees and can perform microtransactions. The utility of IOTA has never been in doubt.
In an interview with Dominic Shiner, a senior developer at IOTA, he stressed the company’s belief in creating value for users against hype.
"When it comes to IOTA, we are focused on value creation. We believe in the future that blockchain; that distributed ledgers are here to solve fundamental problems that we have with our current systems" Going further, he said the company is still focused on its goal to have “hundreds of millions” of transactions on its network and it is not bothered about the fact that it hasn’t gained a massive adoption commensurate with its utility.
He drew our attention to the recent projects and announcements of IOTA like Trademark Africa, Gaia (NASDAQ:GAIA) eggs with the European Commission, and Project Alvarium which have real-world impact and can transform cities as opposed to projects centred around hype.
IOTA: A Project With Value
The utility of IOTA is numerous as it provides value that is missing from other solutions. Launched in 2016, IOTA came up with a model which isn’t a blockchain but a system of nodes that confirms transactions instantaneously with no fees through its Tangle technology.
This has already solved two of blockchain’s biggest problems – scalability and fees. Scalability and slow transaction times have plagued blockchain technology for some time.
IOTA solves this problem because there are no blocks which means no miners and no fees. IOTA provides limitless possibilities without fees.
The utility of IOTA stretches to making smart cities and making global trade secure by authenticating products. IOTA can authenticate car insurance, for example, based on actual usage.
On the Flipside
- Hype will always be associated with crypto projects because of the nature of the market.
- The mass adoption which IOTA deserves may not come in the short run.
The Effects of Hype Over Value
As Dominic Shiner stated, the hype around crypto projects without value is bad for the users and the market. The hype around projects is inevitable because developers want to make quick money without providing utility.
Since crypto projects are decentralized, users adopt a project by what they see and the hype around it to make a profit. Some of these projects, particularly meme coins even go as far as using celebrities to push their coins.
After users buy a coin and the hype gradually goes down, the utility of the token is expected to make it useful and continue its growth. Hyped projects have no utility so the price crashes, users make a loss and the market suffers from investors being afraid of “scams”.
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