What is Tezos (XTZ)?
Cryptocurrency allows you to make purchases(online and offline.) You could also trade them for profit. For a currency thought to be the “currency of the future…” less is known about cryptocurrency, and several people are skeptical when buying cryptocurrency.
For better understanding, we can say cryptocurrencies (alias Crypto) is a digital currency that can be exchanged for goods and services via virtual means or traded for profit by leveraging its volatility.
To get crypto, you would need to pay with real currencies that is a. However, unlike real currencies, crypto can be volatile and can be traded for profit at convenience.
Also, several companies have personalized crypto, which they refer to as “tokens” these tokens are only viable for each specific company and allied companies. One such company is Tezos, and the token is called XTZ.
The spirit driving any cryptocurrency is BLOCKCHAIN. Blockchain is a decentralized technology distributed across many computers that manage the network.
It is supposedly trustworthy because of its security level, giving your crypto more than hundreds of security levels. There are numerous amount of cryptocurrencies. To acquire cryptocurrencies, you would need a wallet. These can be activated via apps. Wallets allow you to hold your crypto and trade them.
What is TEZOS?
One of the fastest-growing and rising cryptos is TEZOS. Tezos, established in 2014 with the unique characteristics of creating a “self-mending blockchain.”
Tezos, while it’s relatively new compared to others on its category, it has a strong network which is connected through a digital token, that is also referred to as Tezzie or Tez in some quarters.
Tezos, unlike most other cryptocurrencies, do not depend on mining; instead, the token holders receive rewards for participating in Proof-of-Stake (P.O.S) consensus mechanism. Tezos' official website says, “It (Tezos) is secure, upgradable, and built to last.”
As a result of its strong and incredible blockchain network, Tezos became extremely popular, especially in the 2020s, and went on to be valued at $232 million in initial coin offerings, making it one of the biggest ICOs ever to date in the world of cryptocurrency and blockchain technology as we know it.
The Tezos website (tezos.com) defines it as a fully open platform for applications which is backed by a community of builders and researchers.
Tezos is different because it focuses on key areas that focuses on blockchain adoption by offering;
1. Smart contract safety
2. Longterm upgrading
3. Open participation.
As of October 2019 and February 2020, Tez value tripled, reaching its record high; this attracted even more attention to Tez, leading to speculations about its future investment potential.
Like the popular cryptocurrencies, Tezos also uses decentralized ledger; blockchain networks. Tezos uses a smart contract, which is similar to Ethereum, and in fact, Tezos is the Greek term for “smart-contract."
Tezos, is way different from Ethereum as it offers and gives the word smart contracts a whole new meaning; by allowing participants/token holders to directly control the rules of the network.
Tezos operates on an evolving network, and flexibility is seen as the crypto’s major asset.
What Differentiates Tezos From Other Cryptos
The most outstanding of all the aspects that make Tezos distinctly different is;
While most blockchain networks rely on development teams and mining communities to create new designs and choices, Tezos attempts to create a decision making process in the network itself.
If cryptocurrencies were the world, Tezos would be a country practicing democracy, while participants are rewarded for proving to be a part of the democratic process (proving stakeholder).
According to its developers, When a protocol upgrade is proposed, an invoice is attached to be paid out to their address upon their upgrade's approval and inclusion.
In essence, Tezos token holders engage in the collective decision-making process. They vote on pending protocol developments and get rewarded for their participation in each upgrade proposal they engage in.
Voting Stage: How it Works
To participate in governance, participants would need to stake XTZ in a process called “baking.”
You need 8,000 XTZ to start off as a baker
As a baker, you also have the liberty to delegate your tokens (XTZ) to other bakers so that they can earn XTZ rewards.
Bakers are given incentives in other for them to be honest in their votes.
The voting process consists of four distinct voting periods, each separated by 23 days; the periods are split into
This is the stage where participants can submit a proposal to amend or upgrade the Tezos blockchain.
The proposal, which gets the highest votes, will move on to the next round.
The exploration vote period
In this stage, if a proposal gets an 80% votes, it moves on to the next round.
The testing period
The proposal is tested for 48hours. This is to ascertain if the change is safe for the network to adopt.
The promotion vote period
Once the test is complete, participants are allowed to vote as to whether the changes be made permanent or removed.
If a majority of bakers vote for it to stay, the proposal goes through and is implemented.
To get paid, the bakers will include invoices for their proposals. If the proposal gets approved after all four periods, the protocol will calculate the invoice amount and pay it to the baker.
Need To Know About XTZ
• The XTZ crypto plays a key role in maintaining and operating the Tezos network, which can be held, sold, sent, or baked.
• When a participant owns or bakes XTZ, they automatically gain the ability to vote on network upgrades.
In conclusion, Tezos rewards participants with XTZ based on how many tokens they are baking, and those who delegate receive a certain amount percentage added to their Wallet which they can trade at anytime.
Also, blockchain developers still consider Tezos as an immature network and this isn’t surprising given the fact that it’s not established a strong foothold in the market. Investors are advised to be careful while participating. Despite its numerous advantages, it is highly volatile, allowing it to be a dominant chin in the cryptocurrency space.
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