An Overview of Tezos Network
What is Tezos?
The Tezos network is a new and exciting concept that has emerged as the solution to several longstanding challenges in the realm of distributed systems. Distributed systems like the Java and the Ruby on Rails networks that are at the forefront of web development technology are all structured on the idea of unifying the processing power of many different computers to act as a singular processing device or “supercomputer”. In contrast, the underlying logic of these networks is made up of different parts that communicate with one another over wide distances through various protocols and IPs. Many people have criticized this approach as being weak in terms of security, particularly given the fact that a majority of today’s computers are not fast enough to support the high-level protocols and security needed to guarantee the integrity and privacy of the transaction process.
One issue that has been brought up repeatedly is the question of scalability. As the name would imply, the Tezos Network operates on the basis of a proof-of-work system that is designed to allow a set number of participants to collectively maintain and manage the ledger, with a single central database as the reference point for all other participants. This can be likened to the concept of a currency: with the supply of currencies increasing and the number of currencies decreasing, there needs to be a way for the network to handle the fluctuating conditions. The proof-of-work scheme, however, requires all participants to download the same software and run the same program in order to participate in the network. As such, one may ask how a decentralized system like Tezos will manage to scale to large volumes of transactions without requiring the downloading of additional programs and the associated costs involved in running those programs.
The answer lies in the governance function of the Tezos Network. Unlike a traditional computer network, which allows developers to add transactions to the ledger by ‘self-acting’ and imposing penalties for those who do not comply, the Tezos protocol allows users to transact on the network in a self-regulating manner. The governance procedure therefore ensures that only the valid, relevant data will be stored and that no conflicting data will be stored.
Similarly, Tezos relies upon a smart contract technology called the ‘Tezos Compiler,’ which is used to compile a series of smart contracts that can run across multiple distributed networks. These contracts will then restrict the functionality of any participant, whether that be a developer or a business, by stipulating the procedures required to protect the network and by enforcing the collection of fees from participants who do not abide by the stipulations. In the case of Tezos, however, since the protocols are embedded into the source code, it is theoretically possible for anyone to modify the smart contract and to apply his own rules for enforcing the network’s rules. Thus, unlike a traditional network where modifications to the protocol can result in the network being unusable, the Tezos smart contract is virtually foolproof in the sense that a change to the smart contract can never be reversed.
The decentralized nature of Tezos also comes into play with regards to the network’s capacity to accept and distribute payments. Unlike a lot of older blockchains that use proof-of-work, Tezos uses a decentralized Proof-of-Stake consensus protocol that allow for the secure storage and transmission of data without the need for trust. This makes tests a perfect platform for businesses wishing to explore new marketing strategies, applications, and systems without needing to commit resources to these endeavors.
As it stands now, there are a few ways for tokens to gain traction on the market. One way is via speculation, where individuals trade in the hopes of making a profit. Another method is through outright selling, where buyers purchase large amounts of a certain token hoping to see its price rise. Both methods work, but the most reliable way to make money through cryptosporadics is through trading. Because of this, it is likely that there will be an increase in the number of trading platforms that exist for the network. With the right mix of incentives and opportunities, Tezos could soon become the new best thing on the Internet.