IOST (IOST)

• IOST is a decentralized blockchain network based on the “Proof of Believability” ("PoB") consensus algorithm. The project’s mission is to build the "architecture for online services that meets the security and scalability needs of a decentralized economy".

• IOST raised $35.0MM (~ 35,000 ETH) via a private token sale in December 2017 and its mainnet was launched in February 2019. Since then, multiple decentralized applications have been built on the IOS network.

• Some of its key features include: Efficient Distributed Sharding (EDS i.e., a sharding scheme), TransEpoch (a way to secure validators-to-shards assignment during epoch transitions while maintaining transaction operability), Atomix (a two-step inter-shard protocol to verify the atomicity of transactions in Byzantine protocols), the Proof-of-Believability (PoB) algorithm (a Byzantine consensus protocol), and Micro State Block (MSB) (a mechanism to minimize the storage and bootstrapping costs for validators).

• In the IOS system, IOST tokens serve as the medium of exchange for all transactions and commission fees.

1. What is IOST (IOST)?

IOST, 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.

It relies on key features like:

• 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"): a mechanism to minimize the storage and bootstrapping costs for validators.

• Efficient Distributed Sharding ("EDS") (under testing): a 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): it secures validators-to-shards assignment during epoch transitions while maintaining transaction operability.

• Atomix (under testing): this two-step inter-shard atomic commit protocol guarantees transaction atomicity in Byzantine settings.

Its mission is to become the .

Three key differentiating factors of IOST when compared to its competitors include:

• Validator process: rotating committee that 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.

• Developer-friendliness: the IOST team has focused on providing a faster virtual machine & offering SDKs to make it easier for developers to build on using Javascript, Python, or Go.

IOST is the native asset of the IOST network. Some 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 third-party issued IOST network tokens.

2. IOST's key features

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 called 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 process

Although the results of voting do not directly determine the committee members, they do have a proportional impact on the Servi acquisition rate. In the current version, 17 committee members are selected for block production each round.

Each round consists of three steps:

1. All candidates will get Servi proportional to their votes.

2. Ranked by Servi, the top 17 nodes will form a committee that is in charge of the block production for the next round.

3. 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.

Example scenario

Assume a simplified version where three nodes are selected for each committee, and the current candidate pool is 5.

The nodes are awarded 10, 8, 5, 4, and 1 Servi, respectively. Let's name them A, B, C, D, and E. Also, let's assume the votes are unchanged throughout the voting period.

In the first round, their points are 10, 8, 5, 4, 1. A B and C will become the committee member since they have the highest amounts of Servi.

Their Servi balances are then subtracted by 5, the same amount that C had. The Servi balance of D and E remain unchanged. We now have the Servi balances of nodes to be 5, 3, 0, 4, and 1.

In the second round, Servi is awarded to each node again. Their balances are now 15, 11, 5, 8, and 2.

A, B, and D now become members of the committee, and they all lose 8 Servi (the Servi balance of node D). Their Servi balances are now 7, 3, 5, 0, and 2.

In the third round, they have balances of 17, 11, 10, 4, 3. This round A, B, and C are voted committee once again.

Fast forward to Round 9. Their Servi balances are now 26, 8, 5, 12, and 9. Node E will become a committee member despite only receiving 1 Servi each round.

Other features and mechanisms

1. 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.

2. 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.

3. If there is a tie for the 17th spot, the node that acquired candidacy first will win. In practice, this will be extremely rare.

4. 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.

5. If a committee member does not produce a block in a round, it will lose votes and candidacy.

6. 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 the 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), the 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.

3. Economics and supply

The token supply distribution is as follows:

• Private Sale tokens made up 40% of the total token supply. It was conducted over 3 phases in December 2017 for 8.4MM IOST at a rate of 200,000 / 150,000 / 100,000 IOST = 1 ETH and raised a total of 35,000 ETH ($35.0MM) at ~$0.004167 per token, selling 40% of the total supply.

• Team was allocated 10% of the total tokens issued (unlocked in January 2019).

• Advisors & equity investors received 2.5% of issued tokens.

• Strategic sale tokens made up 5% of issued tokens.

• Token treasury constitutes 35% of the total token supply.

• Community was allocated 5% of issued tokens.

• BD & marketing was allocated 2.5% of issued tokens.

IOST token supply distribution

IOST holds its funds in cold storage with multi-signature wallets. The keys are held by the CEO, CTO, and CDO. 2 out of 3 signatures are required to unlock the multi-sig wallet.

As of January 18th 2018, IOST has already used 9.81% of the funds from their total raise, all of which were used for community building.

The following chart represents the number and breakdown of all IOST tokens that are to be released into circulation on a monthly basis.

IOST token distribution schedule

Remaining tokens for Token Treasury, Community, and BD & Marketing will continue to be released until 2036.

4. Roadmap, updates, and commercial partnerships

4.1 Original roadmap and achievements

IOST has been on time for all communicated milestones, with an updated roadmap approximately 6 months ahead of the initial schedule.

4.2 Updated roadmap

Q1 2019:

• Release of IOST network client and wallet.

• Launch IOST mainnet network (V1.0).

• Integrated development, production measurement, and optimization.

Q2 2019

• Launching proprietary dApps and commercial applications on the network.

• Launching IOST mainnet with native sidechain support (V2.0).

4.3 Commercial partnerships and business development progress

• Partnership agreement with Chaitin Technology: Chaitin Technology will serve as a network security technical support provider for IOST and will be leading IOST's security testing services.

• Theseus, IOST-incubated R&D team: Theseus is an IOST-incubated R&D team dedicated to pushing the envelope in blockchain technology and paving the way for the IOST developer community. Its stated goal is to develop practical applications for consumers and companies in industries that can potentially be transformed by utilizing the power of the IOST blockchain.

• Bluehill, a blockchain incubator, and accelerator founded by IOST: Bluehill supports partnership projects, dApp development, and other blockchain advancements within the IOST ecosystem.

• Covalent x IOST partnership: Covalent (COVA) is partnering with BlueHill, the blockchain incubator, and accelerator founded by IOST. Covalent's focus is on creating a private blockchain and data utilization infrastructure on the IOST blockchain platform.

• Rate3 partnership: Rate3 is designing a simple infrastructure for trustworthy e-commerce relationships and merchant-to-consumer payment channels, while also creating a reliable credit scoring system for traditional lenders and capital providers. Rate3 will be utilizing the IOST blockchain platform.

• DDEX decentralized exchange: DDEX, one of the largest decentralized exchanges on the Ethereum network, will create a dedicated decentralized exchange on the IOST network, providing a trading platform for IOST token pairings.

• IOST Game: IOST Game will be building the Realm 10 ecosystem on the IOST network. The IOST Game team is independent of IOST and is a third party team that wants to contribute more high-quality blockchain games towards the IOST ecosystem.

5. Project team

6. IOST's activity and community overview

Strategy

IOST has specific teams focusing on two core communities: developers and users:

• For the developer community: IOST has an active team conducting outreach and business development to educate developers about IOST and the benefits of the platform. IOST encourages and incentivizes developers to build on the IOST network through a range of initiatives.

• For the user community: the team tries to provide as much frequent updates and transparency regarding what progress it has made and is currently focusing on. This includes a full bi-weekly update, weekly tech update, weekly partner node update, and daily announcements of specific events and developments. IOST also has various initiatives for user engagement, including content creation submissions, puzzles and challenges, AMAs, giveaways, and other ad hoc initiatives.

IOST's community is spread worldwide, with strong user bases in China, Korea, Japan, South East Asia, Europe, North and South Americas, and more. The team also has active private groups & communities on Kakao and WeChat, as seen below.

Social media and community channels

Telegram (English)
Twitter (English)
Facebook (English)
Medium
Reddit

7. Appendix

• IOST Economic Model, Consensus Mechanism and more

• Voting Mechanism

• What is IOST? Next-Gen Blockchain - Explainer 101

• Meet the Team: Discussion with Co-Founders about the IOST blockchain