The news about the introduction of the Shimmer network and thus the possibility of staking for IOTA is still fresh. There is a lot of buzz in the community. In the meantime, it even triggered a MIOTA rally, which was only abruptly stopped by the burgeoning worries about a new SARS-COV2 virus variant.
Another effect of the news was also that many IOTA hodlers withdrew their holdings from popular exchanges. The target here is the Firefly Wallet, with which staking will be possible in the future. The withdrawal had such dimensions that the exchanges needed days.
The Aftermath of the Shimmer NET introduction
Staking has received a lot of attention, but after the initial dust settled, the other announcements could be digested. And these were not few, around NFT, dApps, DeFi and the possibility to govern.
Still, many are questioning how staking and IOTA fit together.
To understand, staking is applied to newer generation blockchains as a consensus mechanism. Proof-of-stake replaces the well-known proof-of-work.
So far so good, but IOTA is not based on a blockchain at all. It’s based on a directed acyclic graph (DAG) called Tangle. So why does IOTA need staking?
Well, the answer is provided by Hans Moog, Software Engineer at the IOTA Foundation, in a talk with Dominik Schiener this Monday.
Why Staking for IOTA on Shimmer
Moog says that ultimately IOTA doesn’t need staking.
In doing so, he points to the coming social consensus. Currently, IOTA still uses a central coordinator, but this is to be abolished (Coordicide). If you want background information on social consensus, I recommend this site (currently only in German).
Then why staking for IOTA?
The answer is actually quite simple, the IOTA Foundation wants to get closer to the real world. The Shimmer network is the springboard for this. It is nothing less as an innovation playground where it is easy to build MVPs under real world conditions.
However, this can only work if the network (community) is large enough. Thus, the staking rewards.
However, as I mentioned at the beginning, the interest of the community is huge so far. Smart move by the IOTA Foundation. Let’s build in the real world!
As always, I’m looking forward to hear your opinion. Here in the comments or on Twitter.
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