In the last few weeks, the IOTA team made significant progress to get Chrysalis on the manner in March. The biggest network upgrade in our history is not only a march towards production-readiness, but also an enabler of exciting new use-cases, partners, and products that have not been possible before.
The Chrysalis upgrade brings with it several interlocking projects, all of which are intended to expand the use of IOTA.
To realize the Machine Economy, feeless micropayments are required, immutable, verifiable data, self-sovereign identities, smart contract for total autonomy of processes and tokenization of digital and physical assets. IOTA is currently building all these components.
The IOTA Digital Assets Framework is now available
We want to offer a wide range of tools, libraries, and frameworks to allow the IOTA Tangle to be fully utilized as the protocol evolves. Today, we are happy to share the Digital Assets framework with IOTA. Today's release of the specifications is an official step towards bringing tokenization to IOTA.
This is a unique, but a critical, piece of our ecosystem that interlocks with and is interrelated to a multitude of other moving parts of IOTA (hint: Smart Contracts). This is an important moment in our history. We are shifting from an economy based on one native asset (the IOTA Token), to a vibrant digital world that includes tokenized assets, data streams, and even NFT's.
The foundation for digital assets that can be accessed on the IOTA Tangle is laid by IOTA's Digital Assets Framework. Tokenized assets that are part of the IOTA Digital Assets framework enjoy the same security, scalability, and (no fees) as native IOTA tokens. Digital assets on IOTA are one of the most robust, scalable, and secure in the industry. This will allow for explosive growth in economic value as they can be traded and secured on the IOTA network.
Tokenization makes it possible to manage real-world assets, trade them, buy and sell them on a distributed ledger tech (DLT). This technological breakthrough will have profound ramifications. Tokenization will change the exchange of value and the concept of tokenization. Tokenization removes barriers and allows for greater democracy in finance and investment. It also provides a safer, more transparent, and easier-to-manage environment for assets.
A feeless, flexible protocol such as the Tangle can transform tokenization. It doesn't matter if it's an individual making a micro-investment into real estate or an artist protecting intellectual property. A restaurant manager is issuing gift certificates. A car company is issuing shares in its fleet of mobility vehicles. An IOTA Digital Assets framework is the infrastructure that allows anyone to tokenize and use assets securely and inexpensively.
IOTA tokens offer many possibilities
IOTA's Digital Assets framework opens up new opportunities and possibilities for tokenization. We are helping our ecosystem realize the unlimited potential of tokenization to be used in concrete business applications, from issuing digital securities to trading NFT artwork. Tokenization has many benefits beyond the obvious business potential. You can create tokens and trade them.
We are currently working on the most exciting applications today:
Tokenization that is production-ready and enterprise-level as part of Machine Economy: IOTA tokenized assets can provide real-time data feeds with a small footprint. Think digital twins on steroids.
Crypto applications like multi-asset wallets or cross-chain Uniswaps: IOTA Digital Assets is a platform that allows cross-network asset trading. IOTA acts as a free bridge currency. The IOTA token will soon be able to represent other assets like Ethereum, Cardano, or Bitcoin as the framework matures. This will allow for seamless inter-asset bridging. IOTA Digital Assets do not create a bridge between currencies. Instead, they allow only one pool to be created and one bridge can be built. The IOTA Digital Asset framework allows for only one integration, which opens up the possibility of swapping between any assets in the network.
Non-Fungible Tokens (NFT): An NFT can be used to represent artwork, collectibles, special edition items, or any other unique and exceptional item. It is basically a digital property right that can trade. While NFTs are becoming increasingly popular on crypto protocols, IOTA Digital Assets is likely to explode the market with its feeless transactions.
Smart contracts require tokenization.
The Digital Assets framework, especially for IOTA's Smart Contract Protocol(ISCP), is a critical security component that enables smart contracts. Smart Contracts will be made possible by the addition of our Digital Assets framework to the IOTA network. Tokenized assets, in addition to their functional component, will work with smart contracts to create completely new uses.
Smart contracts that use tokenized assets will automate much of the business that can be done more efficiently, securely, faster, and cheaper on distributed ledgers. Smart Contracts are required for many of the more complicated use cases for IOTA Digital Assets (e.g. complex rights management for security tokens), we will share our progress updates about smart contracts in the coming weeks.
The future roadmap
Today, we have released the protocol RFC for Digital Asset Framework on IOTA. We urge everyone to carefully read it and invite domain experts to offer their comments. We remain dedicated to transparency and openness and continue to rely on the contributions of our community. Today, tokenization has been made available on the Coordicide Testnet. (GoShimmer). We will now be able to support digital assets on IOTA Mainnet due to the changes made in Chrysalis (in specific UTXO).
We want IOTA Digital Assets to be available on the mainnet as soon as possible due to their importance. Once the RFC has been approved and reviewed, and the Chrysalis upgrade is complete, we will be focusing on adding support for digital assets to our mainnet in the next protocol update. We are thrilled to incorporate the Digital Assets framework in our Firefly wallet. This will make it easier for our community and users to use new digital assets.
We invite the community to join us in building together, as there are many NFTs that can help with asset management, democratic investing, asset protection, art evolution, and other value-creating activities. All it takes is for us to get started. We are open to granting applications from projects that want to create this future together with the Ecosystem Development Fund.