All news is rigorously fact-checked and reviewed by leading blockchain experts and seasoned industry insiders.
- The proposed IOTA Rebased network aims to improve scalability, decentralization, and programmability.
- The upgrade would include Move-based smart contracts, over 50,000 TPS, low fees, and staking rewards of 10–15% APY for network participants.
The IOTA Foundation has announced a proposal to transition its Layer 1 network to a new protocol called “IOTA Rebased.” This shift is its attempt at increasing the ecosystem growth rate through the adoption of full decentralization, increased scalability, and enhanced programmability. A proposal vote will be held to decide if this protocol should be implemented for the IOTA network or if the current IOTA network should be maintained.
Key Features of IOTA Rebased
IOTA Rebased presents a completely decentralized Layer 1 backed by the Delegated Proof of Stake (DPoS) consensus model. It offers 150 permissionless validator slots to ensure that the network is scalable and secure. According to the new protocol, it processes more than 50,000 transactions per second and has a finality of 500 milliseconds with a low-fee structure that incorporates the concept of dynamic fee-burning.
The protocol also supports Move-based smart contracts, allowing developers to deploy highly complex applications directly on Layer 1. Features such as staking rewards of 10-15% APY aim to incentivize network participation.
Additional features include:
- Sponsored transactions for improved user experience.
- Local fee markets for optimized network economics.
- Liquid staking tokens (LSTs) to bolster DeFi applications.
The new architecture focuses on the programmability of the platform and user-friendliness to make IOTA a formidable player in the blockchain market.
Accelerating Adoption and Ecosystem Growth
The IOTA Foundation’s decision to rebase results from the increasing need for a scalable and programmable blockchain. While IOTA 2.0 would take years to implement, IOTA Rebased is expected to roll out at a much faster pace.
With close to a decade of experience, IOTA plans on onboarding industry partners through enabling new use cases. For instance, dissecting value chains for trade finance in Kenya or building decentralized on-chain order books for tokenized assets is feasible. The Native Layer 1 capabilities will also include stablecoins, digital product passports, and collateral-backed lending. IOTA Rebased positions itself as a leader in the adoption of blockchain by offering enterprises and developers a solid platform to develop new applications.
Strategic Implications for the Ecosystem
If the proposal is passed, the current protocol will be replaced by IOTA Rebased after some testing, security checks and exchanges listing it. The governance vote which is expected to close on Thursday will determine the direction of IOTA’s future.
Notably, Shimmer, the staging network for IOTA, will no longer serve this purpose. Instead, it will focus on a specific approach to stand out from the rest within the ecosystem. This division enables IOTA to concentrate on the provision of unique solutions to its clients through the mainnet.
With the adoption of MoveVM, which is based on the developments made by Meta in the field of blockchain, IOTA wants to become part of the Move ecosystem. The capability offered by Move-based smart contracts and the general programmability of Layer 1 makes the network compatible with EVM applications while helping to open up new possibilities for paradigms such as zero-knowledge (ZK) proof and advanced cryptography.
