The compare between Bitcoin and IOTA seems legit. They are the first products of two different digitized technologies i.e. Blockchain and Tangle respectively. Though Blockchain is still in infancy. It has managed to take over world’s leading industries. Businesses are incorporating this technology into their process to smoothen their transactions. But then there are certain issues that are difficult to fix here. When it comes to Tangle, it is ready to solve all the problems faced by Blockchain technology. Let’s understand how!
What are Blockchain and Tangle?
Blockchain: A distributed data storage network, where the information is stored in blocks and they are cryptographically protected. Bitcoin and other cryptocurrencies are based on Blockchain. Blockchain has miners and transaction fees. It has blocks that contain transaction information, has hard fork/soft fork capabilities, uses distributed consensus and HASHCASH for proof of work.
Tangle: Technically called as Directed Acrylic Graph (DAG) i.e. a directed graph that consists of the finite number of edges and vertices. Here directed means it only points one way, Acrylic means it is non-circular and graph, in this case, means that Tangle itself is the ledger for storing transactions. In this architecture, it is impossible to return to the same vertex you came from. Tangle has zero miners, zero fees, no blocks and hence no hard/soft fork capabilities but it uses distributed consensus and HASHCASH lite for proof of work. Also, Tangle offers quantum security and offline capabilities.
How do They Work?
Blockchain: When the transaction work then this network receive a message. These nodes then update their copy of bitcoin ledger to show the changes. So this process means transaction include the miner’s block with each transaction. But Blockchain is getting slower and congested as more users are coming in, resulting in the higher transaction fee.
Tangle: When a new transaction is performed via tangle then the latest transaction must check and approve the last two transactions. Larger the users, more the transactions to approve two previous transactions, resulting in a faster and improved network. This technology is free and doesn’t require any transaction fee.