In the dynamic realm of blockchain technology, Tezos has begun to emerge as a top-tier Layer 1 network.
This comprehensive exploration delves into this multifaceted project, from the intricacies of its core technology to its current market position and the promising future that lies ahead.
Understanding the Tezos Blockchain
Tezos, a decentralized, self-amending blockchain platform, introduces a paradigm shift in the industry. Its architecture is a sophisticated blend of innovative consensus algorithms, a unique Proof of Stake (PoS) mechanism, and self-amendment protocols.
Core Technology Behind Tezos
At the heart of Tezos lies several distinctive technologies, including a unique blockchain architecture, on-chain governance, and smart contract compatibility.
The Blockchain Architecture
Tezos' blockchain architecture serves as the bedrock of its functionality. Like many other blockchains, Tezos uses Proof of Stake (PoS) as its consensus mechanism. However, Tezos also introduces a solution called self-amendment.
Self-amendment allows Tezos to upgrade itself without having to split (“fork”) the network into two different blockchains. This reduces coordination and execution costs for protocol upgrades and makes it easier to implement future improvements.
Tezos has a proven, decentralized governance process that enables seamless upgrades and prevents the need for hard forks. Community members propose upgrades for the network and validators vote on which proposals they would like to see explored.
The stages for implementation include five periods: proposal, exploration, cooldown, promotion, and adoption.
Smart Contract Integration
A hallmark of Tezos is its seamless integration of smart contracts. Tezos supports formal verification, a technique used to improve security by mathematically proving properties about programs such as smart contracts.
Tezos (XTZ) — The Native Cryptocurrency
XTZ, is the native cryptocurrency of the Tezos blockchain network.
Role and Function of the XTZ Token
Tez (XTZ) is the native cryptocurrency of the Tezos blockchain. It is used to interact with dApps, pay for fees, secure the network through staking, and provide a basic accounting unit on the Tezos platform.
XTZ in the Cryptocurrency Market
As of December 2023, XTZ ranks around #76 in terms of market cap with a total market cap of over $870 million.
How Many Tezos (XTZ) Coins Are in Circulation?
As of December 2023, 964 million XTZ are in circulation. The number of XTZ in circulation continues to increase as users who stake XTZ claim their rewards. There is no maximum supply of XTZ.
Tezos Compared to Other Cryptocurrencies
Benchmarking Tezos against other cryptocurrencies offers a comprehensive view of its market position and adoption trends.
Although Tezos has a much smaller ecosystem compared to blockchain networks such as Ethereum, Polygon, and BNB Chain, it does have a few notable ecosystem projects.
For example, Manchester United uses the Tezos blockchain to issue its digital collectibles. McLaren Racing also selected Tezos for a multi-year technical partnership across Formula 1 and esports. Tether (USDT) runs as a stablecoin on Tezos.
Additionally, the network's ecosystem also consists of decentralized apps (dApps) for gaming, digital identity, decentralized finance (DeFi), and more.
Technological and Adoption Milestones
Tezos continues to introduce new upgrades to its blockchain platform each year.
For example, its Nairobi upgrade in June 2023 added up to an 8x increase in TPS for transactions, smart contract calls, Smart Rollup maintenance operations, and other manager operations, thanks to an improved gas model for cryptographic signatures.
Also, its Mumbai upgrade in March 2023, cut block times in half to 15 seconds via the completion of an improved block validation pipelining.
As of December 2023, Tezos has surpassed 123.1 million contract operations, 2.47 million funded addresses, and close to 203 million transactions.
Tezos stands at the forefront of innovation and practicality, offering a compelling glimpse into the transformative possibilities of decentralized ecosystems.
Thanks to its robust decentralized governance process and self-amendment technology, the Tezos blockchain network is built to continuously adapt to the needs of its users.