Category: Random

A rough summary of transaction fees for the IoT with current systems.

A rough summary of transaction fees for the IoT with current systems.

We often talk about IOTA as the new distributed ledger that promises a financial and infrastructural solution in a world where fees for transactions act as a barrier to progress, especially in the IoT.

But how big are the present existing fees for a system like the IoT? Do we really have a problem?

I tried to find out! Very amateurish, I might add, but enough for this purpose.

 


 Pre-conditions:

 

A bigger issue in estimating a none-existing number such as the “global-transaction-fee-index” is to find systems that are overall able to deliver the necessary services globally.

I take the liberty and define the “global-transaction-fee-index” as an indicator that shows the impact of the “mean fees” that would be added to a value transaction in the IoT.

The lower this index is, the worse it is for the IoT (shown with an example under “conclusion”).

This number is almost certainly utter bullshit but it gives us an idea how expensive and cumbersome transaction fees could be.

For my evaluation, I made a list of relevant requirements for present services:

  • the service needs to be fast (financial state of the art)
  • the service needs to be available almost everywhere (high adoption)
  • the service needs to be a commonly used technology right now (no proof of concept)
  • the service needs to be a system that is documented well enough to be assessed 

This list supposedly isn’t complete but should be enough for this assessment.

For my calculations, I furthermore held to the very conservative estimate for the IoT-devices by Gartner of approximately 30 billion devices in 2020 (Source: Gartner)

We can assume that not every single device will be used for shifting values because a big piece of the pie will just be connected to submit data in any way.
But my relatively high estimation, especially because of new emerging e-markets, is still around ~5%.

This little assessment, therefore, starts with a number of 1.5 billion devices that need to shift value just once a week in 2020

I have no idea if this is close to reality but we have to start somewhere, so this acts as a reference.

If you find any serious, scientific approach to transaction fees in the IoT, I would be happy to get it somehow!


The services I found that held up to the requirements are no surprise:

 


Swift /wire transfer  (globally active instead of national-remittance)

Paypal  (most popular payment service – highest online adoption)

Visa (also a globally used service with access to markets everywhere on the planet)


The resulting fees are:

 

            The IoT is a global system so Swift instead of national remittance is what we need for now. 

  • Paypal: “the fee for each transaction is 2.9% plus $0.30 USD of the amount you receive”

            Paypal has a few competitors especially in the Asian region like Alipay but is generally spoken the biggest fish. 

            Debit Cards as a whole are in a sensitive competition, so I assume that fees of MasterCard etc. are comparable to Visa.


The naive fallacy:

 

Let’s pretend to know the percentages of the transaction system of the estimated 1.5 billion transactions, once per week in 2020.

  • Since SWIFT is aiming for bigger transfers, I assume a small share of just 5 %
  • Paypal, especially in the growing field of e-commerce would have a share of 60% (we assume a mean value of 10$ per tx)
  • And Visa would have a share of the remaining 35% of all transactions.  (we again assume a mean value of 10$ per tx)
  • At this point, I don’t include micro-payments because existing systems simply make them impossible

That leads to:

Swift = 75 million tx/week

Paypal = 900 million tx/week

Visa = 525 million tx/week

Calculation:

Swift = 75 million * ~$30 = 2.25 billion Dollar per week

Paypal = 900 million * $0.59 ($0.29 + $0.30) = 531 million Dollar per week

Visa = 525 million * $0.251 ($0.151 + $0.10) = 131 million Dollar per week.

All global transaction fees combined per week: roughly 2.91 Billion Dollar per week (!) 

Even Bitcoin would *only* generate fees about 1.125 billion Dollar per week if the scalability would stay at 75cents per transaction, which isn’t the case, sadly.
The scaling of Bitcoin would lead to much higher transaction fees due to the big number of 1.5 billion transactions per week. But I don’t know how much that would be and furthermore, Bitcoins adoption is not as advanced as the mentioned services. So this is irrelevant.


Conclusion:

 

The global transaction-fee-index would be (the higher, the better): 

1.5 billion transactions / 2.91 billion Dollar = 0.515 with existing systems

If the transaction fees would be 10 million Dollar per week due to proof of work, electrical expenses or investments in tokens for IOTA it would be:

1.5 billion transactions / 10 million Dollar = 150 (290-fold of 0.515) with IOTA

Whatever this number means, a multiplicator of ~290 in the global economy is a game changer either way. Even if it wasn’t 0.515 but 5 it would be a disaster for the IoT (!). 

This estimate of 2.91 Billion Dollar per week (151.23 Billion Dollar annually) is just a number without a scientific background, but let’s be honest:

Is my calculation so unrealistic?

We can alter the numbers down to 10% of what I calculated but we cannot hide the fact that the vision of the IoT gets into trouble if these systems don’t evolve.


And that, ladies and gentlemen, is one big reason IOTA is a necessary technology!

If you have questions or if I made a mistake, leave me a comment -I would be happy to discuss this assessment!

Have a nice week,

Limo

 

 

Your Experience on “The Tangler”

Your Experience on “The Tangler”

Dear readership!

I’d like to improve. The easiest way to know what you want is to ask you, so I prepared some small polls.

This takes 20 seconds, I appreciate your time.

(I have just been told: it seems to be a plugin problem that if Adblock is activated the poll is unresponsive)


(3 answers per poll)

What do you like to read the most?

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Concerning the design on "The Tangler"

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(just one answer possible)

I am unsatisfied for some reason.

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The World of Tomorrow

The World of Tomorrow

When futurologists talk about their vision, we can read their words, we can somehow fathom their ideas but it’s always hard to draw an image before our inner eye.
In this article, I’m trying to create my own image of what lays ahead 25 years from now.


Well, 25 years are not that much you may ask?
Think back. 1992. The Internet, “just a trend anyway” some said, was run with 4 terabytes a month -worldwide. We kiddos either used our time with Looping Louie or with our precious Tamagotchi. Nope, that was 1997. These were different times. No digitalism, no data-streams, no online gaming, no cell phone for everyone except Miami-Vice in his Cabriolet. No Whats app, hell it was even a pain in the ass to gather all our friends at the doorsteps which were one, five or ten streets away.
We played Ghosts n’ Goblins on the Commodore 64, single-player. Or Commander Keen.
We had a bike, a football, a doll and if grandma was generous a Game-boy with Tetris and Super Mario Land.
We jumped because Kriss Kross told us so, and if our crush didn’t want to meet us, we heard November Rain. And at this point, I feel pretty old and analog.


Today, we have Blogs, we trade crypto-currency, and we get creepy ad recommendations into our browser to buy a virtual reality headset to slay some 3D mummified bear sharks, because we googled it to buy it on Amazon.

Today, we tinder to have sex with a housewife “just 3 miles from here!”

The last sentence alone would be enough to trigger a stroke or two in 1992.

But here we are. We live in a totally digital world. One geomagnetic storm from the sun could be enough to kill our economy, if our Internet provider has maintenance, we get bored in a second. We want to be wired. Weird.



25 years from now would be the same “mind-clusterfuck” for us now like 2017 would be for people from 1992.

“Smells like teens spirit” from 1992 could be considered an oldie, even Skrillex. Agony.

People won’t have a cellphone, but a communication chip, implanted in their shoulder.

On this chip, enough data space to store the history of mankind of the last 3000 years.

People can hear music, paid per view, paid per seconds you listened, activated with colored Logitech buttons within their vision, comparable to a digital head-up display. Your arm is your mouse.

Time will be shown on your skin, with ferrofluid, formed as numbers with an electromagnet, powered by body heat.

It is uncommon to buy software in 2042. Software is provided. If you want to use it, use nano-payments for the time you enjoy its service.

Electric cars don’t need to have parking tickets. They drive autonomously through the gates and pay the amounts you need for them to stay, at the end of the visit.

We won’t use paper, except for, well some things can’t be done digitally. Hygiene is conservative.

The water you use instead will be paid without you even noticing. Also groceries, medicine and porn.

You have an automated calculation for your bills. If you ever be short of money, you will be reminded 6 months before you run out of crypto. You don’t even have to think about cash, everything is online, automated, done behind closed algorithms.

At this point, let’s not talk about the development of housewives in your neighborhood.

Instead: Marriage contracts. They will be saved within a crypto-currency. People will get a certificate and celebrate their unique hash of love.
Uhhh, the hash starts with 4444! Fortune for the family. Good times ahead.

25 years from now, we need to be wired. We will depend on connections. And we won’t pay for it. Neither for connections nor for shifting values.

In our very future, we have some greater things to do than paying for payment.

We still have these annoying Facebook friends we don’t really know, but constantly get Candy Crush invites from.

In the future, it is called Holo-book though, and these damn 3D-diamonds are crushing through your roof. The sensor data of the IoT managed to find out where you are, in what state of sleep you are and which color you like the most. People pay advertisements based on this data, available because the Tangle saved the information.

If we are unlucky, then Justin Bieber is running for Presidency in 2042. Since 2017, this kind of scenario isn’t made by Stephen King anymore as we all know.

Humanity has a lot of construction sites in 2042 besides Holo-book.

The climate-change won’t be a boring subject in school, but ever-repeating hurricanes in 6 months a year.

Sequencing DNA to save people from countless diseases will be accomplished with a tangle-based “world-computer”. All for one, one for all. Progress.

If you ask me, 2042 will be hard to grasp. But damn, I’m really curious what lies ahead.

Have a good week,

Limo


pic: http://7-themes.com/6879019-future-wallpaper.html

The incredible January

The incredible January

Hey Folks!

Lots of important stuff has happened since my last entry so time to sum it up for you! Fasten your seatbelts, IOTA is on its way to launch its rockets!

 


Light wallet is already in beta test

-The light wallet is already completed and beta tested while I’m writing. With this wallet, people are able to work with IOTA, conduct transactions and claim their IOTA’s but they don’t need to manually add neighbors. They just need to add one peer to be connected to the main net. This software is a big step to connect to a broader range of people especially if they are not that tech-affine or interested in spending too much time on adding neighbors.
As this service is not the focus for IOTA’s future in hindsight of its machine-economy, it is very important to get more people on board.
One successful point on the list to get ready for official exchanges.


Free server for the coming light wallet:

-@moodledidoodledi and @scottjp as the owner of www.iotasupport.com are happy to announce a newly set up server to provide users of the light wallet with a peer-IP.
Iotasupport.com is proudly supported by http://www.blockchain-research.de/ and would be grateful to get donations to keep up the support and service they provided for months now!
Iotasupport.com became a reliable source of information and provided help for countless people, so let’s help them out! These guys deserve it!


Mobile wallets are also beeing tested 

Needless to say that this mobile wallet is a big important addition to the software spectrum, the community has created. Great work Oliver, Sascha and Adrian!
The team behind http://iotawallet.info/ provided us with an important piece of software on the long road to mass adoption and the listing at exchanges so if you can spare a coin or two,
donate and show them some love!


@bahamapascal set up 6 nodes for a better network.

On behalf of the Blockchain research lab, Pascal took his time to set up 6 additional nodes for a better connection within the tangle. Great work!
If you struggle to find enough peers for your wallet, pm @bahamapascal in slack and share your (if possible) static-Ip with him to be a part of the tangle.

This also applies for all members of #nodesharing in the slack. If you need peers, pm people in nodesharing and share your IP.

The server costs were supported for 2 months by http://www.blockchain-research.de/ so I’m pretty sure Pascal would also be happy to get a few coins for his support and efforts for the upcoming months of support!


IOTA C# implementation.

Tomer Krisi (@Artik123) delivered an incredible piece of work: He just ported IOTA to C-Sharp.
This is a BIG step towards a better distribution, getting more developers into IOTA . Also: this was voluntarily done. What a great job!


New foundation-members

-Chris Skinner joined the IOTA foundation as an advisor! This is an invaluable addition to the already astonishing expertise, the IOTA foundation managed to bring together.

Also: Navin Ramachandran joined the IOTA Foundation: priceless!

 


Trading-bot:

-A new OTC bot provided with the excellent service of Yassin (@yassinnxt) is life to enable trading before IOTA is listed on official exchanges.
@come-from-beyond took his precious time and integrated this bot in slack.
This service was set up to provide a temporary solution as CORE is occupied with important tasks behind the curtain. The bot is pretty cool considering the automatic features it provides.

The OTC-bot service assisted by Yassin works as follows:

1. You send BTC or iotas to an address provided by Yassin (via private message)
2. Yassin executes a command to deposit the accordant amount to your balance tracked by the bot
3. You buy/sell iotas (this can happen as many times as you need)
4. You send Yassin an address to withdraw the earned BTC/iotas
5. Yassin adjusts your balance and sends real tokens to your address
6. Trades are taxed with 0% fee.
7. Deposits/withdrawals are charged with 1% fee (rounded up).
8. Min amount of a deposit/withdrawal is 10’000 microBTC/2 Gi.
9. To get instructions on how to trade iotas once you get your tokens on the balance type “HELP” on #trading channel.
10. As a precaution, you are advised to provide Yassin with an extra BTC and IOTA-address to be able to receive your funds once you left slack for different reasons, such as a ban or technical issues.
11. For each IOTA deposit, a new address must be generated. This is necessary to show the right balances for each entry listed by the bot.
12. For better usability, Gi and microBTC for fees are always rounded. (1Gi for 2GI-100Gi, 2Gi from >100Gi-200Gi and so on)

The service was tested with test tokens, but it is still possible that an undiscovered bug may lead to a loss of all your BTC/iotas, so we suggest to trade small amounts per session.

Example-trade:

1. Alice contacts @yassinnxt and says “I want to deposit 50 BTC”
2. She sends 50 BTC to an address provided by Yassin
3. Once 50 BTC are confirmed, Yassin types “GIVE 49.5 BTC TO @Alice (1% fee included)
4. Alice contacts Yassin and says “I want to withdraw 200 gigaiotas (Gi)”
5. Yassin executes “TAKE 200 Gi FROM @Alice”
6. Yassin sends 198 Gi to Alice
7. Alice contacts Yassin and says “I want to deposit 200 Gi”
8. She sends Yassin 200 Gi
9. Once 200 Gi are confirmed he types “GIVE 198 gigaiotas TO @Alice” (1% fee included)
10. Alice contacts Yassin and says “I want to withdraw 50 BTC”
11. Yassin types “TAKE 50 BTC FROM @Alice”
12. Yassin sends 49.5 BTC to her (1% fee included)


Also worth mentioning: 

-The newly created sandbox beta can be tested in #sandbox-beta

-@bahamapascal and @strongwares created a node-sharing manager. I will deliver more info about that when I tested this tool myself. Great work!

-Dom wants developers to start coding real PoC for bounties! If you are interested: Go into Slack and offer your help and I’m pretty sure he can provide you with some inspiration!

If you are capable and creative: Take this chance and become a part of IOTA! You won’t regret it.


Blockchain research!

The Blockchain Research Lab of the University of Hamburg is pleased to announce the first of our Blockchain Monitor surveys. It forms the basis for creating a sentiment index about blockchain use cases in finance.

Please help the Blockchain world by completing this survey: https://indivsurvey.com/blockchain-monitor/63983/hbgmb8

(and, of course, we would greatly appreciate if you help us to spread the link) – here we go!

 


So, all in all, we saw an unprecedented month so far and it’s just the 16th of January so I’m pretty excited to see the rest of it!

If you have questions or additions, feel free to contact me in the Slack at @limo

Have a good day!

 

 

image: http://www.universetoday.com/wp-content/uploads/2010/01/rocket.jpg

Sustainability through Innovation

Sustainability through Innovation


Hello world

Let’s draw a link between sustainability, which is the challenge of the 21. century, and innovation in the realm of the Internet of Things and Blockchains.

Bitcoin’s success was a combination of a pioneer-technology paired with the possibility to change the world’s financial problems; a solution where one currency replaces others.

Cryptocurrency as an object of speculation also generated several bubbles within the last years. Not surprisingly, many people’s involvement was incentivized by money, or worse, greed.

The diversification and evolution of Blockchains, however, lead to new fields where the incentive became innovation itself.

Sustainability in the field of IoT and Blockchains can be an important part of the challenges of the 21. century.

 

The Anthropocene

A good start for understanding the responsibilities of the future is to outline what has happened in the past and what will happen in the future; in this way, the history of mankind is important in understanding our recent issues.

This expansion is, other than seen in the animal kingdom, not necessarily driven by survival. Humans tend to take everything, wether they are required or not.

 

6a00d8341bf7f753ef01bb0851546f970d

 

The industrial revolution and the time that followed, including electrification, was and is the main reason scientists refer to the Anthropocene. The age, when humans became a part of the stratigraphic geology of the earth.

As part of this transformation, the energy consumption rose exponentially .

The extreme hunger for energy lead to the climate change, a problem people in the western world are still trying to fathom. Then there are people with no access to education or those who just don’t care.

While the carbon dioxide levels are rising, we still raise our annual energy consumption to new levels and run our power-plants with coal and natural gas.

Fortunately, we have an agenda in turning this problem into a solution.

 

The Energy Transition

“China set a world record, again, in 2015 by adding more installed capacity of both wind and solar in a single year than any other country (32.5 GW of wind and 18.3 GW of solar). By the fourth quarter of 2015, China overtook Germany with the largest installed capacity of solar power in the world (with a total of 43 GW).”
Heinrich Böll Foundation, 2016

 

One strategy to curtail the consequences of the climate change is the transition from fossil to renewable energy resources like wind-, water- and solar-energy.

The need of these new resources is revealed when we take a look at the carbon cycle of the earth, which is significantly affected by human emissions ( figure 1 below, earthobservatory.nasa.gov).

Approximately 9 billion tons of carbon a year are emitted by human activities.

 

carbon

 

The continuing industrialization beginning with the western world, which is now spreading through countless developing countries demands new solutions on a global scale, not just in certain areas of the world.

As mentioned, the first step is and will be the energy transition. The upcoming demands of billions of renewable energy-systems, the industrial transition to better technologies, in general, generates millions of new jobs and opportunities for the economy.

Considering the remaining need of heavy construction vehicles in the field of heavy industries, it’s likely to say that this energy transition will take time.

The economy will still depend on fossil resources as these systems are multi-spherical and not easy to change.

One way to accelerate this infrastructural transition is to change the energy-consumption on a local or personal level in our daily lives.

 

Intelligent consumption

 

Here is where innovative Blockchains can make a difference.

Let’s imagine a system functioning on a Blockchain, which is able to reduce the energy-consumption worldwide.  This system is able to replace countless other systems, where energy would be wasted.

This system would also be decentralized to prevent it from being captured or turned off.

A distributed network where a political decision wouldn’t matter because of no institution but the connected peers had the authority to change its behavior.

The first non-political system on a global scale, to unite humanity and to improve the life of billions of people.

Millions of sensors would observe climate conditions and as a consequence adjust climate control systems so that energy wastage would be prevented effectively.

These adaptive systems could be installed everywhere and on any device. The most prominent use-case would be adaptive streetlights.

We don’t need light were no one is walking or driving, so why wasting energy?

The installation of these innovative solutions could spare a lot of energy and money. As a positive feedback-loop of sustainability, this money could be used to built even more

renewable energy facilities.

Another big part of an environmentally friendly system would be to observe and detect humidity levels in soils.

Big agriculture farms are usually in sunny regions but as a matter of fact, sunny regions often cope with low levels of subterranean water which is not regenerative and decreasing fast (Figure 2, USGS).

 

gwdepletion-map-2008

 

Humidity-adaptive systems for modern irrigation of agriculture are therefor the only solution.

In the end, it’s the peoples choice to support those systems and the become a part of it.

To close the circle: Blockchains can be and will be an important part of the future and even if this vision is given with an aftertaste, not all Blockchains or tangles are the same!

 

Have a great day,

Limo

 

 

 

 

 

 

Genesis

Genesis

iota_invert

As the ecosystem of IOTA grows everyday I felt the need of a blog, to summarize all important information. No bells and whistles, just information.

As an active member of the IOTA-community, I will lay the focus on foundation-related news, as well as speculative-related information.

Feel free to visit me once in a while and spread the word if relevant news come up.

Have a good day!

Limo

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