Overview

Tezos is a permission-less, distributed, and also the self-amending platform which is utilizing smart contracts. The Tezos blockchain is meant to be self-evolving and capable of amending functions based on the community’s determination thanks to the company’s on-chain governance process and many noticeable improvements over similar platforms such as Ethereum. Blockchain and Crypto is advancing at such a pace that it seems rather difficult to keep up with all the latest developments. As innovations unfold, Tezos predicts that their blockchain will remain on the cutting edge. Moreover, they have some arguments to support this claim.

Product and Vision

Tezos is a unique blockchain. It was built from the ground up by its developers. The protocol wasn’t based on any other blockchain by forking or building an extra layer on top of an existing project. The goal was clear from the beginning: creating a blockchain that can incorporate future developments and innovations without risking a hard fork that could divide its community.

Tezos has one essential characteristic which differentiates their blockchain from its competitors. That innovative difference is in how additions and changes are made to the blockchain:

1. A developer proposes changes or upgrades to the Tezos protocol.
2. When doing so they are able to attach an invoice to the proposal and if the change is approved by the community and added to the next upgrade they get paid in XTZ tokens.

This has two benefits: First, it encourages developers to participate in Tezos development. Second, it also decentralizes the maintenance and development of the network. Let’s take a look at what is it that makes Tezos different enough to consider its process as a viable replacement for other major blockchain projects? Every other blockchain can be described as an interaction of three layers:

• State: An internal, mutable state type. In bitcoin, for example, this would be the set of unspent outputs.

• Apply: A transform that takes a state S, a transaction T, and produces a new state S.

• Score: Scoring function that determines the valid blockchain branch. In bitcoin, this is the total amount of hashing power on the chain.

Tezos differentiates itself by making the apply and score variables a part of the mutable state, allowing the ledger rules to be self-governing.  Feature-wise Tezos carries many of the same aspects as other blockchains. It is decentralized, transparent, secure, and encryption based to make it virtually unhackable. InTezos’s case, they use a generic network shell which is compatible with the different transaction and consensus protocols a blockchain needs. In other words, it was built with a modular fashion in mind.

Problem-solving abilities

Through its technological and structural benefits, Tezos positions itself as a major rival for Ethereum. Although Ethereum is making a switch to PoS, their consensus is still expensive and has required several patches and upgrades. Additionally, the network is not capable of scaling up to high numbers of transactions per second (15), while Tezos is capable of up to 40 TPS. Furthermore, its self-amending nature makes it a more agile solution than Ethereum, as it allows for real-time changes that don’t fragment the community. The delegation process and the change proposals also provide strong incentives for positive and productive participation within the network.

Team

Tezos was developed by Arthur and Kathleen BreitmanBozman Çağdaş, Benjamin Canou, and a team of other developers. We will focus on Arthur and Kathleen Breitman:

CTO, Arthur Breitman is a computer scientist, with experience working in the financial sector (Goldman Sachs and Morgan Stanley). He closely followed the historical rise and adoption of Bitcoin from the outset and noted it’s “inability to evolve” and instead lead to hard forks. His proposed solution is the Tezos project that exists today.

CEO, Kathleen Breitman also has experience in the financial sector. Kathleen has worked at a range of different companies including Bridgewater Associates and R3, which is a blockchain consortium.

One thing I noticed about the project is that it has some big names behind it. For example, Olaf Carlson-Wee, the founder of Polychain Capital, has been outspoken about his support for Tezos. Investor Tim Draper has also mentioned plans to invest in the project.

Tokenomics: What is the XTZ Token?

Through their ICO, the Tezos foundation collected 66 000 Bitcoin and 361 000 Ether. In the space of only 13 days, the remarkable amount of $232 million in funding was sent to the project. A record-setting number for any ICO at the time. According to CoinMarketCap, there is a total supply of 763.306.930 XTZ in the currency pool. The circulating supply is currently 607.489.041 XTZ, and the price for one XTZ is $1,31, which adds up to a market cap of $793.963.720.

Growth Potential

During the second quarter of 2018, Tezos launched its beta net after several delays and issues. The mainnet launched, as scheduled, on Monday, September 17. The company noted in April that they expected it to be fully ready in the third quarter of 2018. The platform is now finally operational.

The more the crypto and blockchain space evolves, the more decentralized applications (dApps) will be created. It would be healthy for the whole ecosystem if these new applications, projects, and companies could choose from a broader range of platforms to support their ideas. Ethereum still has the most significant market share, but there will be a need for different types of platforms, which differ in terms of scalability, governance and the level of decentralization. Tezos has the opportunity to position itself as a serious competitor to ethereum.

The project`s Whitepaper presents an excessive amount of data on the technical component of the project. It is overloaded with formulas and lines of code which makes it difficult to find the right information – such as a strategic development plan for the project, or a budget.