Tezos (XTZ) Things You Need To Know Before Investing

What Is Tezos (XTZ)?

Tezos is a blockchain network based on smart contracts in a way that’s not too dissimilar to Ethereum. However, there’s a big difference: Tezos aims to offer more advanced infrastructure — meaning it can evolve and improve over time without there ever being a danger of a hard fork. This is something that both Bitcoin and Ethereum have suffered since they were created. People who hold XTZ can vote on proposals for protocol upgrades that Tezos developers have put forward.

To learn more about this project, check out our deep dive into Tezos.

This open-source platform bills itself as “secure, upgraded and built to last” — and says its smart contract language provides the accuracy required for high-value use cases. According to Tezos, its approach means that it is futureproofed and will “remain state-of-the-art long into the future,” meaning it can embrace developments in blockchain technology.

The technology underpinning XTZ was first proposed in a white paper released in September 2014. After a series of delays, the Tezos mainnet launched four years later.

Who Are the Founders of Tezos?

Arthur Breitman was the man who wrote the Tezos white paper — and in a nod to Satoshi Nakamoto, he wrote his works under the pen name L. M. Goodman. He argued that one of Bitcoin’s biggest failings was the lack of a governance process that invited contributions from the community who use the network and the fact that new tokens couldn’t be issued through this blockchain.

He and his wife Kathleen founded a startup called Dynamic Ledger Solutions, tasked with writing the code that would underpin the XTZ protocol. This company was subsequently purchased by the XTZ Foundation to ensure that it owned all of the intellectual property rights relating to the network.

What Makes Tezos Unique?

Although staking is common across blockchains, Tezos has a unique twist on this process. Participants can get involved with the network’s governance through “baking,” where they effectively stake 8,000 XTZ. This creates a financial incentive to act honestly.

Bakers are then tasked with voting on proposed changes to the blockchain’s code in a four-step procedure that takes approximately 23 days. Proposals that receive support from most participants are put through their paces on a testnet for 48 hours and are fully implemented if a super-majority backs them.

XTZ is also unique because of how it has started to be used by high-profile businesses. In September 2020, it was announced that the French banking giant Societe Generale planned to use this blockchain for experimenting with a central bank digital currency.

Big cryptocurrency exchanges such as Binance and Coinbase have also unveiled support for XTZ staking, meaning users can receive rewards based on the XTZ that they hold. This is not a feature that’s seen too widely across digital assets.

How Many Tezos (XTZ) Coins Are There in Circulation?

Our data shows that 743,862,304 XTZ are in circulation in writing.

A token sale for Tezos was held back in July 2017 — and during this ICO, a total of 65,681 BTC and 361,122 ETH were raised. At the time, this was worth $232 million, securing its place as one of the largest initial coin offerings ever held.

While 80% of this initial supply went to investors, 20% was split equally between the XTZ Foundation and Dynamic Ledger Solutions.

The mainnet’s launch was delayed by a series of lawsuits from some disgruntled investors, who argued that XTZ amounted to unregistered securities.

How Is the Tezos Network Secured?

Like other blockchains, Tezos uses a proof-of-stake consensus mechanism.

Anyone can become a validator and contribute to the smooth running of the network by making a security deposit. To incentivize honest behavior, rewards are given to those who work in the best interests of the blockchain — and those who act dishonestly risk losing their stake altogether.

Where Can You Buy Tezos (XTZ)?

XTZ, otherwise known as “tez,” can be purchased from most major exchanges — including Binance, Coinbase, and others. Trading pairs unite XTZ with fiat currencies and other cryptocurrencies such as Bitcoin.

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