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What is IOST?
IOST is a blockchain project focused on scalability that employs a novel consensus mechanism called Proof of Believability (PoB) and a sharding approach, called Efficient Distributed Sharding (EDS), to enable speedier processing. It aims to construct an infrastructure that handles high transactions per second (tps) in order to fulfil a decentralised economy’s security and scalability requirements.
IOST token is the native cryptocurrency that serves as the fuel for the IOST blockchain, which is touted as an ultra-fast decentralised blockchain network.
A brief history of IOST
IOST was founded by Jimmy Zhong, Justin Lee, Kevin Tan, Ray Xiao, Sa Wang, and Terrence Wang. On 30 June 2018, the project launched a public testnet and transitioned to its mainnet in February 2019, developing the Internet of Services (IOS), a proprietary blockchain focused on scalable and high-throughput smart contract processing. It provides the infrastructure layer required to develop and deploy large-scale decentralised applications (dapps) requiring high-throughput processing. IOST is also working on new services, such as decentralised storage and a developer feedback system. Ethereum, NEO, Stellar, and Zilliqa are examples of similar projects with which IOST competes.
On 3 January 2018, the IOST Foundation conducted a token sale, generating roughly US$35 million in ether (ETH). During a private sale, only institutional investors were eligible to acquire tokens; there was no further public sale. Tokens were priced at 200,000 IOST per ETH in the first stage, 150,000 IOST per ETH in the second stage, and 100,000 IOST per ETH in the third stage. At the end of the sale, a total of 21 billion tokens were generated. Participants in the private sale received 40% of the total supply (8.40 billion IOST).
The IOST Foundation received 35% of the entire supply (7.35 billion IOST), which was frozen until the mainnet launch. A separate allotment of 12.5% of the total supply (2.63 billion IOST) was made available for community incentives. The remaining tokens were distributed to the team, who received 10% of the entire supply (2.10 billion IOST); and to early investors and advisers, who earned 2.5 percent (525 million IOST).
How IOST works
IOST is a decentralised, service-oriented blockchain that provides services to traditional businesses to help them adopt or transition to blockchain technology. IOST claims to process up to 100,000 tps (Ethereum, for example, has a value of 20; TRON has a value of 2,000 and EOS 4,000). Its scalability and higher tps amounts provide a major solution for large corporations.
To accomplish these transaction speeds, the IOST team designed a novel blockchain architecture that introduces and combines various technologies, including the Distributed Randomness Protocol, TransEpoch, and Atomix.
IOST depends primarily on its PoB protocol and EDS to increase the scalability and security of its blockchain in order to compete with hundreds of specialty blockchains. It uses tokens that are tradeable on various crypto exchanges.
What is IOST used for?
IOST — an acronym for ‘Internet of Services Token’ — is a medium of exchange for all transactions and commission fees. In the IOST ecosystem, the token can be used for payments (for services and goods provided by merchants or other community members) and commission fees (to validators as compensation for running smart contracts and processing transactions, etc.).
IOST also plays an important role in calculating a user’s believability score. PoB is a consensus algorithm that enables high transaction throughput speeds while ensuring nodes stay compliant, using factors including IOST token balance, reputation-based token balance, network contributions, and user behaviours.
Additionally, as a member of the IOST ecosystem, each user can acquire IOST tokens by contributing resources (e.g., running smart contracts, providing storage, etc.). In the future, IOST has plans to launch a decentralised algorithmic stablecoin.