Finalization of IOTA

It’s no longer news that the IOTA Foundation is planning to abandon trinary and go binary way ( https://www.crypto-news-flash.com/the-saga-continues-iota-foundation-publishes-clarification-of-the-dispute-with-ivancheglo/). There will be some other breaking changes:

1. Support of cryptographic algorithms not immune to quantum computers (leading to someone hacking big chunk of iotas and dumping them on the market when QC become the reality);
2. Removal of bundles for the sake of having atomic transfers of variable size (making it impossible to process transfers on low-end IoT devices);
3. Adoption of global sorting in the Tangle to enable address reuse and other features (which will impose a serious penalty on performance).

I cannot agree with these changes so I’m finishing IOTA on my own (together with some other guys). To avoid confusion I’ll be using “IOTA” to call my version of IOTA and “IOBA” to call the IOTA Foundation’s version where “B” stands for “binary”. I think I have the moral rights to take the name with me because it was me who created IOTA (Dr. Popov created Tangle) and now I’m just finishing it.

To allow those holding iobas to get iotas a swap will be enabled after Ict (software implementing IOTA protocol) is ready to some degree. The details of the swap:

1. One sends N iobas and gets N iotas no matter at what price the both are traded on the market;
2. Received iobas are sent to an exchange and are sold for BTC or other currencies no matter at what price IOBA is traded on the market;
3. When the whole IOTA supply is swapped (it’s equal to IOBA supply) the swap ends.

Why this is not an ICO but a swap — during an ICO, just like during an IPO, tokens are offered at the price set by the market, but here we get a 1-to-1 swap.

Why not classical “forking” when owners of iobas get the same amount of iotas — to get rid of the dormant addresses, some of their iotas are controlled by David Sønstebø (65 Ti) and by the IOTA Foundation (16 Ti), the both entities are not welcome to join the original IOTA because their actions led to necessity to do the swap and created other problems.

From the point of view of Game theory this swap looks interesting. If you own iobas and don’t believe that IOTA can succeed you may still consider swapping 0.1% of your iobas for iotas just to give it a try. If IOTA becomes more popular than IOBA you may lose the chance to swap all your iobas. How the swap may affect the price of IOBA is another interesting topic.

To gauge the interest in IOTA you may look at a poll being conducted on Twitter at the moment of writing of this blogpost — https://twitter.com/PeterInAsia1/status/1237624438121590784.

Feel free to ask questions.