The Best Crypto Exchanges to buy and hold Tezos (XTZ)?

The Best Exchanges to buy and hold Tezos (XTZ)?

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Tezos is an open-source blockchain network and decentralized computing platform that runs smart contracts launched on the mainnet in 2018. Unlike most competitors, Tezos aims to resolve disagreements and prevent hard forks through its own evolving on-chain governance model.

Tezos uses its own proof-of-stake consensus, Liquid Proof of Stake (DPoS). This will allow holders of the network’s native coin tez or tezzies (XTZ) to vote on protocol upgrade proposals. Anyone can become a validator, deposit a deposit of XTZ Coins and contribute to the operation of the network.

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What is Tezos?

Tezos’ initial coin offering (ICO) was the largest in the history of cryptocurrencies at the time. In July 2017, this record-breaking ICO raised 65,681 BTC and 361,122 ETH ($232 million at the time) from many participants who received 80% of the initial XTZ supply. The remaining 20% ​​is split equally between the Tezos Foundation and Dynamic Ledger Solutions, founded by Tezos co-founders.

After the ICO, legal issues delayed the launch of the platform, making Tezos a rather controversial project. By the time of its launch, the cryptocurrency was going through a long bear market. However, unlike many other projects launched through ICOs, Tezos has successfully overcome initial difficulties and remains a popular staking platform rather than a development platform.

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Floating Proof of Stake (LPoS) Consensus

Proof of Stake has existed in several forms since it was pioneered by the founder of Peercoin in 2012, but in the last 1-2 years, famous platforms such as Ethereum 2.0, Polkadot, and Cardano have developed their own versions. Upon launch, it became famous as a consensus model.

Tezos was an early adopter of the proof-of-stake model, creating its own version of the floating proof-of-stake model. It is often confused with Delegated Proof of Stake (DPoS) used by EOS and Tron, and although there are actually similarities, the two are distinctly different.

In the floating proof-of-stake model, anyone can become a validator or ‘baker’ in the Tezos network that can accommodate up to 80,000 bakers. There are, of course, minimum requirements. Bakers are required to stake 10,000 XTZ tokens. However, anyone can join as a baker without expensive computing equipment. Conversely, EOS has 21 fixed validators and Tron has 27, and requires a fairly complex technical setup. In comparison, Tezos can be said to be more decentralized than a Delegated Proof of Stake platform, as it has a low barrier to entry and a high tolerance for the number of bakers, which guarantees fairly active validators.

XTZ holders who want to participate in governance but do not want to become a baker can delegate their stake to a baker, who can use it as part of his 10,000 XTZ. Delegating does not require the delegator to relinquish control of the XTZ.

This voluntary delegation process is different from delegated proof-of-stake, which requires delegation to elect validators.

At the time of writing, Tezos is ranked 7th on the list of staking platforms and is so popular with stakers that approximately $2.7 billion worth of XTZ has been staked. It is ahead of EOS, but still inferior to new PoS chains such as Ethereum 2.0, Polkadot, and Cardano.

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On-chain governance

Blockchain governance is a complex and hotly debated subject. Although the operational aspects of blockchain are described in consensus methodology, the process of upgrading networks and implementing changes to core software often takes place off-chain.

For example, Bitcoin and Ethereum both implement changes using an off-chain mechanism. If you don’t like the upgrade of Bitcoin or Ethereum, those miners can continue to mine the old version. This process is known as “forking” and has led to several significant forks creating new platforms and currencies, such as Bitcoin Cash or Ethereum Classic.

Envisioned under the principle of ‘code is law’, Tezos is one of the few platforms that leverages 100% on-chain governance. Delegators who delegate XTZ stakes to bakers will also delegate voting rights. Any baker can propose a protocol change, and if the majority agrees, it will be automatically implemented on the Tezos testnet and subject to further voting for 48 hours before being implemented on the Tezos mainnet.

This system has been very effective in strengthening Tezos network security by reducing the number of bugs in the contract code so far. However, on-chain governance runs the risk of voters forming a cartel to influence certain decisions. Therefore, the debate between on-chain governance and off-chain governance continues.

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Who made Tezos?

Tezos was created by Arthur & Kathleen Breitman. Arthur is a computer scientist and mathematician, and Caitlyn comes from the financial world.

Arthur wrote the initial Tezos whitepaper under the pseudonym LM Goodman. At the time, he argued that Bitcoin lacked adequate community governance and ruled out the majority of participants from having a say in the development of the dominant cryptocurrency. At the same time, he also discovered that it was impossible to issue new tokens with the Bitcoin protocol.

After co-founding Dynamic Ledger Solutions with Kathleen, the two began coding Tezos protocols. After that, the Tezos Foundation acquired the startup and secured the intellectual property previously owned by the latter.

The project was put in jeopardy after the Brightmans appointed their acquaintance Johan Gevers as president of the Tezos Foundation. Their relationship deteriorated, and Jeeves took control of the foundation and refused to pay the funds, causing great anger among investors. Eventually, Jeeves left the Tezos Foundation and the project was able to resume work on the roadmap.

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How is Tezos actually used?

According to the Tezos Project website, there are currently over 120 projects related to Tezos. Notable among them are Coinbase Custody and Swiss Sygnum, which offer XTZ staking services to corporate clients. There are also a number of projects that do securities token offerings (STOs) with Tezos. One of them will be BTG Pactual, the largest investment bank in South America with plans to proceed with a $1 billion STO trading pipeline.

Many familiar blockchain apps such as DeFi, games and NFTs are also using Tezos ‘ platform.

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Where can I buy and store Tezos?

Tezos is available for purchase on major cryptocurrency exchanges such as Pemex.

XTZ can be stored in hardware wallets such as Trezor or Ledger, mobile wallets such as TezBox or Atomic, and desktop wallets such as Tezos Blue.

Tezos has been on an endless roller coaster journey. However, this proves that the project and community have endured well in the fast-changing world of blockchain and cryptocurrencies, and continue to rank higher than their competitors. Their biggest challenge right now is to gain traction between dApp developers and users, as they have successfully captured stakers’ attention. If this challenge is overcome, it will occupy a firm position in the future blockchain ecosystem.

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