The IOTW of AnApps is actually an IoT blockchain venture that permits low-power micro-mining using smart devices, and also introduces the IOTW cryptocurrency.
In a world where proof of work (PoW) and proof of stake (PoS) consensus algorithms are the center of the attention of the day, it is hard to envision that there could actually be an alternative which slams the debate and renders both inadequate in comparison. After all, despite the flaws in the systems, as well as in the polarized adherence which we see to each of them, both sides can agree on one thing, and that is that no other contender has yet convinced them that there is something better out there.
What about IoT mining? IOTW is a blockchain venture by AnApp, which creates a cryptocurrency with a transaction layer that first of all rely on IoT devices, to establish consensus. It also believes that this is the way to go.
The only times we hear about IoT mining is actually when some hacker figures out how to use the thermostats of people, to mine cryptocurrencies. According to a report from recently by Symantec, these connected devices saw an increase of 600% in attacks.
The voluntary use of some devices which barely have the processing power of a smartphone from 2010 for making any sort of profit mining cryptocurrencies, looks a bit counterintuitive. This thinking can actually be connected with the fact that most of the people think regarding how proof of work functions whenever mining is mentioned.
After all, it is the most popular consensus algorithm on blockchains which is used today. It is not essential whether the PoW concept focuses on raw computing power, the vision of IOTW for an IoT-centric blockchain will still involve absolutely none of that.
Entering the world of PoA blockchains
The ambitious ICO which we discuss has some plans for a consensus algorithm which would work with such tiny devices and:
Consume far less surplus energy than the blockchain of Bitcoin;
Overcome some flaws of the proof of stake, which usually selects “validators” that possess large amounts of cryptocurrency, as well as computer systems with plenty of storage;
Provides an unprecedented level of scalability;
Decentralizes blockchains in a more efficient way than Either algorithm;
Offers a fair chance for miners to get a reward.
This is an algorithm which is known as “Proof of Assignment.” It is named like this as of its solitary requirement that a mining node proves that it is assigned as part of the network.
IOTW also claims that such type of protocol can be implemented in almost any IoT device that is with minimal cost, and no investment in new hardware, consuming very light amounts of power on top of what the device consumes in the first place.
According to one whitepaper of IOTW, the system was already tested on over a thousand devices that are running in a network relying on a trusted node.
Maybe one of the most interesting claims is that the network is going to support larger transaction volumes as it grows, which is almost a polar opposite to the proof of work status quo, a protocol which struggles to surpass 10 transactions which are processed per second at the best of times in Bitcoin.
The startup has also admitted that the PoA model is quite similar to PoS in some aspects. It said that similar to PoS, the mining devices in the IOTW blockchain do not require super computational power. Additionally, IOTW removes the need for mining devices to store the transaction ledger. This also eliminates the cost which is connected with the large memory and therefore, adding mining capability to simple IoT devices is going to become affordable.
The whitepaper continued, stating that instead of permitting every network node to participate in mining in PoW, or having a voting process to elect the appointed validator for a transaction in PoS, PoA elects one single candidate or a limited number of candidates in order to solve the cryptographical problem by pre-agreed criteria, and issue the task directly to the chosen candidate.
PoA needs adoption to have any value
As devices with such limited hardware cannot store an entire blockchain, the network actually relies on its trusted nodes, to record the transactions which are validated.
Even though the whole PoA concepts looks like a good one, in theory, it needs some adoption actually to have any value. For this reason, IOTW has to explore scenarios which would persuade IoT manufacturers to place its firmware in their products.
IOTW has already demonstrated their firmware running on Wi-Fi chipset Expressif ESP32, and the Expressif chipset family has already had shipped over 100 million units cumulatively.
One of the specific use cases could be a smart refrigerator which uses IOTW to automatically make quick grocery purchases. A sensor which is used in logistics could detect that the data storage space of a server is full and automatically order more storage for the information it needs to dump.
The transmission speed of IOTW, measured with transactions in HK and verification in the U.S, is actually measured at 3K/sec, and it is similar to Visa and is faster than PayPal.
IOTW blockchain will remain secure
Of course, the manufacturers could already make some devices which use fiat for this aims. But, IOTW has a higher adoption threshold than any fiat currency, being a decentralized product which is not managed by an institution.
Also, it could be used in place of fiat to provide a convenient payment gateway, particularly for companies which operate internationally and which make different cross-border payments.
The concept of PoA was tasted in a substantially limited setting, one that holds some water, but is not enough to tell us if around the world adoption is genuinely on the cards. This is not a surprise, considering that IOTW is still at its nascent stage.
But, we can actually see that the initiative is spearheaded by the CEO named Fred Leung, a man that has a wealth of experience as the head of an IoT company, before departing in November last year, to start this venture. The rest of the team is actually made up of people with a background that include leadership roles in companies inside of the computer science industry.
When it comes to security, IOTW issued a witnessing protocol and even with attacks way over 51%, the IOTW blockchain should actually remain secure.
Overall, the venture seems to be in good hands and on its way to making a mark when it comes to how we think about blockchain consensus.