Overview of Tezos
Tezos is a decentralized blockchain that functions with the use of its native token which is the XTZ. Tezos, just like Cardano, does not make use of mining but instead functions with the proof-of-stake system. A commonwealth is defined as a group of individuals or networks that are voluntarily linked together in order to achieve certain goals. The goal, in this case, is to improve the Tezos protocol and blockchain. The Tezos blockchain makes use of a middleware called the Network Shell and this allows for the creation of a self-amending ledger. The blockchain network for Tezos is divided into three parts which are the consensus protocol, network protocol, and the transaction protocol.
Use Cases of Tezos
The Tezos protocol makes use of on-chain governance and this is one of the primary purposes of the Tezos token. Should a developer propose a change or development in the network, they will outline this with an invoice denominated in XTZ and upload it to the network. Those who hold tokens will be able to vote on the development and decide whether or not it will pass. Just like with Cardano, this helps to prevent disputes and hard forks.
The process of adding a block to the blockchain is also done using the proof-of-stake system. In this case, a person referred to in the ecosystem as a baker and then this block is verified by 32 other random bakers after which it may be added to the blockchain. The baker then receives block rewards for this transaction. Again, it should be noted that there is a great community center and focus on unity in the ecosystem.
Like many blockchains, the Tezos system can be used for the creation of smart contracts. It is unique, however, in the use of the Michaelson language which allows for the use of mathematical testing to determine the logic behind each smart contract and also reduces the possibility of vulnerabilities.
The Tezos network is not one of the most popular platforms for the creation of decentralized applications but the management of Tezos is working towards attracting more investors in this regard. The Tezel foundation, for example, is working with Cryptium Labs, Cornell University, and France-IOI and INRIA currently to develop research and education centered around blockchain. This is in line with a common belief that blockchain applications will be more prominent in the future and Tezos is investing early in this idea.
Future Applications of Tezos
In terms of their cryptocurrency, the XTZ saw a significant increase in price value in the early months of 2020 and some see this as an indication of the currency seeing more growth as time goes on. While XTZ is in the top 20 in terms of market capitalization, it is not as well-known as cryptocurrencies such as bitcoin, litecoin, and ether. Only time will tell whether this prediction will hold true or not. In terms of the blockchain, platforms such as Tezos and even Cardano are pushing the idea of a decentralized blockchain with greater user participation. Because these sorts of blockchains are practically immune to things such as hard forks and disputes within the community, many see them as a more stable option, particularly for private companies that wish to make use of blockchain technology. With the collaborations that the Tezos foundation already has in place with major institutions, we could very well see this becoming the case soon. It also serves to highlight the flaws that exist in major blockchains such as Bitcoin that have seen multiple hard forks.
There is also great promise for Tezos in terms of its smart contract language Michaelson which offers a greater level of security for those who wish to deploy it.
Tezos has, for a while, tried to break out of the scandal that surrounded its initial coin offering which was one of the most notable within the cryptocurrency industry. It was also notorious because of the dispute between the management of Tezos as well as the founders around the handling of the funds that were raised during the ICO. With time, however, it seems Tezos is trying to put the scandal behind them and focus on the development of the ecosystem as well as their upcoming projects.
One of the concerns of many blockchain enthusiasts is how blockchain ecosystems will be able to deal with the increasing use and this boils down back to the issue of scalability. Blockchain systems such as Cardano are working to avoid the challenges that blockchains such as bitcoin are experiencing and those focus on scalability. Looking towards the future, Tezos’ current framework prevents many disputes and also gives room for great scalability as its userbase increases into the future. The management of Tesos has not stated any ambitious goal such as millions of transactions per second the way some other blockchains have but it is clear that Tezos is an ambitious project to look out for.
Those who are interested in the ecosystem will likely see it grow in the future and those who are interested in XTZ will also see it gain wider acceptance.