IOTA is the blockchain-based backbone of the internet of things (IoT). Find out how IOTA wants to use blockchain to manage your smart devices today in our review.

What is IOTA?

IOTA, found online at, is a blockchain-based solution for smart device management. As the internet of things (IoT) keeps expanding, we’re seeing an increased need for interoperability and sharing of resources. IOTA allows companies to explore new business-2-business models “by making every technological resource a potential service to be traded on an open market in real time, with no fees.”

The key platform behind IOTA is the Tangle ledger. It’s a scalable, decentralized, modular ledger that can be adapted to manage everything from smart cars to Wi-Fi bandwidth. There’s the potential for users to use IOTA to lease “anything with a chip”.

In layman’s terms, IOTA can be used to lease the computing power of your smart devices to people around the world in real-time. But it can also be used for much more than that.

IOTA was created by the IOTA Foundation, a group of developers based around the world.

How Does IOTA Work?

IOTA calls itself the “backbone” of the “new autonomous machine economy.” The key technology here is the Tangle ledger, which is capable of settling transactions with zero fees.

This ledger allows devices to trade exact amounts of resources on-demand while also storing data from sensors and dataloggers securely and verified on the ledger.

The Tangle is a ledger that works differently than other blockchains and ledgers. The first distinction is that it’s a blockless ledger. It’s a blockless, distributed ledger that’s also scalable and lightweight.

Because it doesn’t use blocks, the ledger can transfer value without any fees. Consensus is no longer decoupled, but instead, it’s an intrinsic part of the system (unlike modern blockchains). This leads to a decentralized and self-regulated peer-to-peer network.

IOTA Features and Practical Uses

The primary advertised role of IOTA is to help us manage and utilize smart devices in a more effective way. It creates an “economy of things”, where we can share the computing power of our smart devices in real-time anywhere in the world.

In addition to this core role, however, IOTA is being proposed for a number of other solutions, including:


Micro and even nano-transactions become easier with IOTA’s Tangle architecture. This creates brand new business opportunities for companies where prohibitive payment transfer fees have made it difficult to create a working model.

Data Transfer

A core feature of IOTA is the ability to transfer data through the Tangle ledger. IOTA lets you establish secure, authenticated channels between devices. All data that’s transferred through the Tangle is fully authenticated and tamper-proof, which means attacks are impossible.


IOTA is uniquely suited for the internet of things, but it can also allow for secure data transmission for eGovernance organizations, making it easier to vote securely online.

Masked Messaging

Masked messaging (MAM) enables nodes to exchange data through the Tangle in a fully authenticated and encrypted way. In a practical sense, this means your smart devices c transmit valuable and sensitive data with quantum-proof security. You can share that data with multiple parties easily – just like a radio, multiple parties can tune into that frequency and get the broadcast data.

Everything as a Service

IOTA can make everything into a service. Anything with a chip in it can be leased in real-time. Your appliances, tools, and drones are some easy examples. However, you can also lease your computer storage, computational power, Wi-Fi bandwidth, and other things you’re not using.

Anything that Needs a Scalable Ledger

In general, IOTA’s Tangle can be used with anything that needs a scalable ledger.

About the IOTA Foundation

The IOTA Foundation was founded by David Sønstebø. Other key members of the team include Dominik Schiener, Serguei Popov, Sergey Ivancheglo, Gianluigi Popov, and Per Lind.

You can read more about the company’s membership team here. The company describes its developers as “dedicated and talented people with a proven track record of getting things done properly.”

You can contact the team by email at

IOTA Conclusion

IOTA’s unique Tangle ledger could change the IoT world as we know it. The ledger promises to be scalable, centralized, and suited for a variety of applications. It also comes with no fees, and makes things like microtransactions more accessible than ever before.

The primary goal of IOTA is to help us manage, optimize, and utilize the IoT – including all of the smart devices we use every day. You can lease the computing power of smart devices around the world, or sell the computing power of your smart devices when they’re not in use.

The full potential for IOTA’s Tangle ledger, however, extends far beyond the IoT, and it could be used in everything from eGovernance to masked messaging.

Ultimately, the internet of things isn’t going away anytime soon. From smart cars to smart guns to smart everything, we need a solution to manage all of this smart technology. IOTA promises to be that solution.


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