You may not agree with premining for other reasons, but please don’t call something a scam just because someone is trying to be a capitalist.
In the context of deceiving users and leading them to believe there is a more even distribution than there is in reality – premining could be a scam. The examples you gave, however, don’t fit the bill.
Not a scam, but there is a problem with premining. Consider the first 1 million Satoshi's bitcoins, which, albeit unintentional, still qualifies as pre-mining IMO - we don't know who owns them and whether they are spendable, their value is mind-boggling and if any one of them is spent, it can cause a panic.
They decided it's a good idea to use ternary logic instead of binary logic so they had to write their own cryptographic primitives based on ternary. Here's a good analysis about the security issues: https://medium.com/@neha/cryptographic-vulnerabilities-in-io...
This is the one main thing that keeps me very, very skeptical regarding IOTA (and the coordinator thing, although that may be resolved someday when traffic increases so they can remove it - at least that's what they say).
It looks a bit like they had this JINN processor developed which appears to be ternary in nature, but it went nowhere, and then they pivoted that into IOTA and stubbornly kept the ternary stuff because that might revive this JINN thing again later on, if IOTA catches on. At least that's how it looks to me from the outside. It's a bit hard to get reliable information about this JINN thing, as the company that apparently developed it, Jinn Labs, is nowhere to be seen publicly, with the excuse of being in "stealth mode". As far as I can see, this entire thing could just as well be vaporware as it could be revolutionary tech developed under strict NDAs.
I'll definitely stay very, very skeptical for now, as it's so hard to get reliable information about IOTA aside from the bling-bling on the surface. I also tried to look at the code of their reference implementation on GitHub a bit recently, since it's mostly Java and I'm mostly a Java dev for a living right now I was interested, but the code quality I can see there is pretty bad overall (like there are almost no comments, most comments you find are actually code that was commented out, formatting seems incoherent, huge amount of bloat code even by Java standards among which it's hard to actually find any real logic), so that excursion also did achieve nothing with regard of alleviating my skepticism.
Did...did they intentionally name it curl, so that when you search for "Is curl secure?" you will find articles saying that curl - the widely used library - is secure, in the hope that people will confuse the two?
I know that you shouldn't assume malice when it can be explained with incompetence, but combined with some of the other points here, I can't help but feel that this was intentional.
Sergey Ivancheglo (@Come-from-Beyond) claims the collisions were intentional and for the purposes of IOTA the hash merely had to be a one way function:
https://gist.github.com/Come-from-Beyond/a84ab8615aac13a4543...
He addresses his base-3 number system design decision as well (by appealing to authority no less :)
> name it curl
In above he references Curl-P and the final letter (see his last gist) also explicitly asks that the MIT security blogger use the full name which she declined.
You can't make this shit up.
https://blog.iota.org/iota-foundation-hires-cybercrypt-615d2...
Your curl function is not even listed as one of the major lightweight crypto primitive on Lux' zoo: https://www.cryptolux.org/index.php/Lightweight_Hash_Functio...
Your post is full of shit.
Also, since we are being pedantic, SHA-3/Keccak is an NIST standard, which is a federal agency of the United States.
https://gist.github.com/Come-from-Beyond/a84ab8615aac13a4543...
https://www.forbes.com/sites/amycastor/2017/09/07/mit-and-bu...
He was also concerned that there's no security proof in the whitepaper. To me, it seems like you could feasibly launch an attack with less than a majority of the computing resources.
If messages cannot be forged, then a consensus could make positive progress with even 99% of participants being dishonest.
Not 33% of participants, 33% of the hash power, could just be one participant with a pile of GPUs or ASICS or "JINN" chips lol. That's the claim made by the IOTA author, anyway.
Right now it wouldn't surprise me if someone could amass 90+% of IOTA hash power anyway.
>If messages cannot be forged
Tbh this is not even a given with IOTA.
Of course PoW provides some protection against sybil attacks, but the reality is that with enough hashpower the network can be overtaken. (Hence why HashGraph is a closed network.)
Second, I didn't say it was necessary to order transactions, I said that is what it is used for, which is correct. You are replying to a point that I didn't make.
https://blog.iota.org/iota-foundation-hires-cybercrypt-615d2...
No scam. There was an announced, publicly available crowd sale available to anyone paying attention & interested in 2015. Sorry you missed it.
Other than that, yeah it's weird. Although I'm not sure why there's so many announcements of businesses like Microsoft, Fujitsu doing partnerships with IOTA. Sounds very weird and overpumped.
Ethereum never depended on a centralized master node.
These simply stated whether a chain was good or bad, and they were controlled by the makers of ethereum. I don't know if they were ever used to mark a chain as bad, but they certainly represented centralized control.
I do see your point that most of the time, ethereum functioned using the decentralized protocol, but there was a centralized fallback.
The wiki page suggests that there was an option to ignore the canary contracts. So you could mine nevertheless without recompiling the source.
There's no such option with IOTA as the coordinator is closed source.
https://github.com/ethereum/wiki/wiki/Bad-Chain-Canary
https://blog.ethereum.org/2015/07/22/frontier-is-coming-what...
* I don't see the correlation between pre-mined and scammy. Please elaborate. In my view it eliminates greed/TX costs because there is no mining.
* Has been discussed ad nauseam months ago, but here it is again https://blog.iota.org/upgrades-updates-d12145e381eb
* ?
IOTA does not proclaim to be finished, it is still in beta. Hence the need for the coordinator. The coordinator will be turned off once there are enough transactions to secure the network.
I already said this in my comment, no need to reiterate it. You didn't repeat, though, that there's no ETA or rough threshold of when it would be safe to turn it off.
Anyone putting their money in IOTA is an absolute idiot.
I bought in when it was trading well under $1. I'm holding long term so I don't much care about today's price, but it _is_ nice to be up >700% so far.
I don't consider myself an absolute idiot on this one.
It's 100% premined, which smells as scammy as Ripple.
Additionally, In contrast to conventional ICOs, IOTA had 0% of their ICO reserved for founders. Not a single iota. The founders had to purchase their technology back during the ICO.
Furthermore, there was no allocation for foundation or ecosystem funds. They asked the community to donate for this foundation to exist. They reached 5% of total supply and that is what the foundation runs on. (~140Ti)
I've heard they rolled their own crypto.
it's an "append and forget" blockchain, lol.So the founders were forced to buy IOTA from themselves if they wanted some?
... which isn't actually so bad when you think about it, as long as those BTC all went to their foundation.
Iota has bigger problems, like pretending to be more efficient by using a DAG, when in reality everybody still needs to see the whole tangle to verify transactions.
As opposed to say, tezos which has 232mil to develop their self-governing token. Additionally, "the founders get 8.5% of the fiat proceeds in cash in addition to 10% of the tokens"\
Iota has bigger problems,Which is still dirt cheap and they got first dibs so nothing major there.
* They have this thing called the "coordinator" which is a master-node run by them, which is a single point of failure. The codebase that this node runs is proprietary software. They claim there will be no need for this masternode in the long run but they never say any ETA about when to remove it (which hints that removing it may always expose the security flaws of their network). This means it's Proof of Authority instead of Proof of Work, therefore, not decentralized.
* It's 100% premined, which smells as scammy as Ripple. It's not a coin, it's an entity handing you gift vouchers with their name on it.
* I've heard they rolled their own crypto. Yes, let that sink. Haven't verified this myself though.
* There's no way for new nodes joining the network to recover the full history of the transactions (a IOTA speaker told me there are some public FTP servers or something where you can get a copy...). So yeah, it's an "append and forget" blockchain, lol.
Be prepared for a big (&deserved) crash.