IOST (or “the Project”), which stands for Internet of Services Token, is an enterprise-level blockchain system for the Internet of Services. The platform is focused on blockchain technology that is ready for mass adoption by providing a Blockchain as a Service product.
- Raised $35.0MM (35,000 ETH) via private token sales in December 2017
- Launched mainnet on 25 February 2019
- Validators are selected and rotated based on the Proof-of-Believability consensus protocol
WHAT IS IOST?
Key Features of the IOST
- Proof-of-Believability (“PoB”): A Byzantine consensus protocol with a Believable-First approach that guarantees safety and liveness of the system while largely maximizing the transaction throughput by size-one-shard.
- Micro State Block (“MSB”): Mechanism to minimize the storage and bootstrapping costs for validators.
- Efficient Distributed Sharding (“EDS”) (under testing): Sharding scheme that makes shards sufficiently large and strongly bias-resistant via a combination of a client-server randomness scavenging mechanism and leader election via cryptographic sortition.
- TransEpoch (under testing): Secure validators-to-shards assignment during epoch transitions while maintaining transaction operability.
- Atomix (under testing): Two-step inter-shard atomic commit protocol that guarantees transaction atomicity in Byzantine setting.
The Project’s mission is to be the underlying architecture for the future of blockchain services.
IOST Token Overview & Use Cases
IOST is the core utility token of the IOST network. A few examples of the use cases of the IOST token include:
- Payment for services and goods provided by service providers and merchants on the IOST platform
- Payment for fees and commissions for running native smart contracts
- Processing transactions and using shared resources such as storage space
- Payment as rewards for contributing network resources
- Exchanging for other 3rd party issued IOST network tokens
BLOCKCHAIN & NETWORK
IOST’s consensus algorithm , Proof-of-Believability (“PoB”), includes a decentralized committee election process while still maintaining the scalability benefits and censorship resistance.
IOST’s design ensures a voting and committee formation process where most nodes are qualified for block production (instead of only the top few nodes) and where nodes with more votes are assigned a higher probability to produce a block.
To achieve this, IOST does not use the voting result as the only factor for selection. Instead, IOST introduces a point system (Servi) to decide and rotate members of the committee.
Becoming a Candidate
To ensure network safety, PoB has an entry barrier for block producer candidates. In the current version, this barrier has been set to 0.02% of available votes on the network. When a node has received more votes than the threshold, it can then send a specific transaction to become a candidate and participate in the committee formation and block production process.
Acquiring Servi and Voting
Although the results of voting does not directly determine the committee members, they do have proportional impact on Servi acquisition rate. In the current version, 17 committee members are selected for block production each round.
Each round consists of three steps:
- All candidates will get Servi proportional to their votes.
- Ranked by Servi, the top 17 nodes will form a committee who are in charge of the block production for the next round.
- All selected committee members will have their Servi balance reduced by the balance of the 17th node. In other words, the 17th node will have its Servi reset to zero, and the other 16 nodes will lose the same amount.
In the current version, the voting period is 10 minutes. This results in the committee rotating once every 10 minutes in the IOST network.
Other Features and Mechanisms
- When voting and committee member selection has completed, a “round robin” DPoS-like rotating block generation begins. In other words, for each committee that is formed, each member takes turns to produce one block, while all other committee members validate all blocks.
- In most cases, the candidate with the most Servi will become a member of the committee. To limit this, a rule is set such that Servi balances are prevented from being more than ten times the total amount of votes cast.
- If there is a tie for the 17th spot, the node that acquired candidacy first will win. In practice this will be extremely rare.
- Candidate nodes need to submit a validation transaction once every 6 periods (1 hour) to prove availability. Otherwise, this candidate will lose candidacy and all votes.
- If a committee member does not produce a block in a round, it will lose votes and candidacy.
- Tokens used to vote are redeemed after 7 days, and the same applies to a node that loses candidacy. Therefore, nodes that lose candidacy due to reasons above will have a “cooling off” period and not be eligible for selection.
Nodes and Voter Rewards
IOST tokens are paid out to nodes based on blocks produced (25% of 840 million IOST tokens reward pool), share of votes received and cast by IOST token holders (50% of reward pool), and contribution score to IOST ecosystem development (25% of reward pool). Node rewards will also be given via 10-30% of fees incurred by the users invited by individual Servi Nodes.
IOST token holders who vote for nodes with their tokens share 50% of that node’s rewards, excluding block production rewards. IOST token holders, by staking tokens to vote, will also get 100,000 GAS per day per IOST staked, which can be used as transaction execution fees.
Ecosystem participants earn a percentage of all IOST network fees (iRam, iGas and account creation) that they process. For example, a dApp team will earn a percentage of fees spent by users while using their dApp.
IOST’s PoB consensus mechanism aims to provide a more decentralized voting and committee formation process by introducing a Servi point system, where the number of blocks produced will be proportional to the votes they receive.
While this design provides advantages in achieving decentralization of the block production process, it also does not compromise the benefits of a DPoS system that enables high scalability and throughput speeds.
IOST considers Ethereum and EOS as two of its main competitors. The team provided the following comparison chart amongst the three chains.
Three key differentiating factors of IOST when compared to its competitors include:
- Validator Process: Rotating committee which can have over 1,000 block producers each day.
- Higher throughput: In testnet, IOST claims to have already achieved 7,000-8,000 TPS - higher than ETH, NEO and Cardano - with its PoB Consensus Mechanism & up to 6 shards.