Up-and-coming cryptocurrency startup IOTA has partnered with more than 20 corporate behemoths such as Deutsche Telekom, Bosch, Microsoft, PricewaterhouseCoopers, Accenture and Fujitsu to build a reliable Data Marketplace for data sharing and monetizing. Several research groups from universities around the world are also involved in the project.
According to IOTA, over 2.5 quintillion bytes of information are generated on a daily basis, but almost 99% is lost because there is no safe place to exchange and share this data securely.
“Any kind of data can be monetized,” said David Sønstebø, who co-founded the Internet-of-Things based cryptocurrency, “If you have a weather station collecting wind, temperature, humidity, and barometric data, for instance, you can sell that to an entity that is doing climatic research.”
The marketplace aims to give connected devices the ability to securely transfer, buy and sell datasets using a “tangle” based distributed ledger technology. Other cryptocurrencies such as Bitcoin and Ether use blockchain technology in contrast.
“IOTA is kind of the first distributed ledger that goes beyond the blockchain,” Sønstebø said, “We got rid of the blocks and we got rid of the chains, which has resulted in getting rid of the major pain points or limitations of the blockchain such as fees, scalability, and centralization.”
As soon as data is put onto IOTA’s decentralized ledger, it is distributed to countless nodes or the computers that connect to the blockchain network, ensuring that it is impossible to tamper with the data, Sønstebø claimed.
Basically, Tangle is a form of Directed Acyclic Graph (DAG), a complex data structure where the devices on the network build consensus through the web of connections between transactions, as they randomly verify each other’s transactions.
This method of verification means there’s no central ledger, and there’s no need for miners to power the network. It is this decentralized permissionless ledger, where the data will be hosted, that may possibly ensure that the data being sold on IOTA’s marketplace is tamper-proof. Since computing power in the Tangle grows as the network grows, IOTA is promising free, fast transactions.
The marketplace demo will run until January, IOTA stated, adding that they will release a series of blog posts and case studies to highlight how companies can use the technology and benefit from it.
While the technology is still new, it may act as a catalyst for a whole new paradigm of research, artificial intelligence, and democratization of data. In tangle, IOTA has used an interesting technique to distribute and decentralize its ledger while addressing the core drawbacks of blockchain system. In their white paper released in October, IOTA had even said the tangle “naturally succeeds the blockchain as its next evolutionary step.”