Tezos Coin (XTZ): Definition, History and How It Works

Bittime - Tezos (XTZ) is a blockchain network that supports a digital token called Tez or tezzie. Unlike other blockchains, Tezos is designed to enable participation in decentralized finance (DeFi), decentralized applications (dApp), as well as non-fungible token (NFT) projects, with unique governance and protocol update mechanisms.

History and Background

Tezos was created by Arthur Breitman, a former Google X and Waymo engineer, who collaborated with his wife, Kathleen Breitman. In 2014, they published a white paper explaining the basic idea of ​​Tezos, with the goal of creating a blockchain that could update itself without the need for forks. 

In 2017, the Tezos Foundation held a hugely successful initial coin offering (ICO), raising more than $230 million in a short period of time. Even though it was hampered by internal conflicts, which resulted in delays in token distribution, Tezos continued its journey.

Read also: City Holder Daily Combo 19 November 2024: How to Get 7.5 Million Coins!

In 2020, Tezos settled an ICO-related lawsuit by paying $25 million to participants who demanded refunds. The price of Tez fell drastically, but reached a peak of more than $8 in October 2021, although it finally fell again in 2023.

How Tezos Works

Tezos uses a Proof of Stake (PoS) consensus mechanism, in contrast to Bitcoin which uses Proof of Work (PoW). With PoS, Tez owners can participate in transaction validation by staking—locking a certain amount of Tez in the network to validate blocks and earn rewards. 

Validators, called bakers, can run nodes to validate transactions, while users with fewer Tez can delegate their tokens to bakers.

Read also: Tomarket Daily Combo 19 November: Claim TOMATO Bonus Easily!

Tezos' uniqueness lies in its voting-based governance system that allows Tez holders to vote on protocol updates. In this way, Tezos prevents blockchain forks or splits that are common in other networks such as Bitcoin and Ethereum. This process ensures updates are carried out in a decentralized manner without involving third parties.

Advantages of Tezos

Tezos stands out for its higher energy efficiency compared to Bitcoin. Because it uses PoS, Tezos is more environmentally friendly and does not require large amounts of power for mining. Additionally, Tezos' governance system that allows Tez holders to vote on protocol updates provides greater stability and reduces the risk of forks.

Another advantage is the ability to adjust the amount of Tez in circulation by creating more tokens as incentives for developers and validators. This aims to keep the network decentralized and active.

Tezos Future Prospects

Tezos technology continues to develop and attract global attention, including being used in experiments by European central banks to trial central bank digital currencies (CBDC). Additionally, Tezos is also involved in the NFT world with support from platforms such as One Of, founded by music producer Quincy Jones. Nonetheless, challenges remain, especially regarding long-term adoption and resilience to crypto market volatility.

Tezos shows great potential, both in terms of technology and its application in various sectors, but it remains to be proven whether its inflation mechanisms and governance innovations can provide long-term benefits for its users.

How to Buy Crypto on Bittime

Want to trade sell buy Bitcoins and crypto investment easily? Bittime is here to help! As an Indonesian crypto exchange officially registered with Bappebti, Bittime ensures every transaction is safe and fast.

Start with registration and identity verification, then make a minimum deposit of IDR 10,000. After that, you can immediately buy your favorite digital assets!

Check the exchange rate BTC to IDR, ETH to IDR, SOL to IDR and other crypto assets to find out today's crypto market trends in real-time on Bittime.