What is Tezos?

Who remembers the ICO (Initial Crypto Offering) boom? This is when thousands of new coins appeared and began raising money like wildfire. Tezos (XTZ) was no exception. It raised a whopping $232 million in July 2017. Tezos went on to persevere the bear market and had a really strong year in 2019 which saw its price breakout to an all time high of $3.80 in February 2020.

But what exactly is Tezos and how does it work?

Tezos is a smart contract and a decentralised application platform. A smart contract is a self-executing contract with the agreement terms written directly into the line of code. Once the terms of the agreement are met, the smart contract can execute based on what is already included in the code. Smart contracts allow the performance of credible transactions without third parties. These transactions are traceable and irreversible.

Who Started Tezos?

Arthur Breitman was the man who wrote the Tezos white paper — and in a nod to Satoshi Nakamoto, he wrote his works under the pen name L. M. Goodman. He argued that one of Bitcoin's biggest failings was the lack of a governance process that invited contributions from the community who use the network — as well as the fact that new tokens couldn't be issued through this blockchain.

He and his wife Kathleen founded a startup called Dynamic Ledger Solutions which was tasked with writing the code that would underpin the Tezos protocol. This company was subsequently purchased by the Tezos Foundation to ensure that it owned all of the intellectual property rights relating to the network.

How is it different?

One major difference between Tezos and other smart contract platforms such as the popular Etherium network, is that it is secured and ultimately managed by Tezos miners, otherwise known as ''Bakers''. The Bakers secure the network, verify transactions and distribute block rewards. Tezos Holders can qualify to be a Baker once they hold 8,000 XTZ. According to stakingrewards.com, bakers earn about 5.40% annually.

No Forks Or Splits Needed For Changes

Another major difference is that the Tezos blockchain can implement new changes to the network without forking or splitting into separate chains. Tezos attempts to solve disagreements that lead to splits by letting network participants decide on protocol changes via four different voting periods. In the voting process, Bakers are the only network participants that can propose a protocol upgrade.

Environmentally Friendly

Tezos is also seen as a more environmentally friendly and energy efficient alternative to other cryptos.
According to tezos.com, Tezos has always been recognized as an energy-efficient alternative to more traditional Proof of Work blockchains. The total annual carbon footprint of the Tezos blockchain is equivalent to the average energy footprint of 17 global citizens.

What Are The Advantages Of Tezos?

• Uses an eco-friendly proof-of-stake consensus mechanism.
• Permits delegating of XTZ to earn partial rewards.
• Bakers can propose and vote on changes to the Tezos protocol through a formalized system.
• Tezos is a programmable blockchain that allows for the creation of smart contracts and NFTs.

What Are The Disadvantages Of Tezos?

• Tezos faces stiff competition from emerging smart contracting platforms.
• Tezos is not seeing widespread commercial adoption yet.
• Tezos has a high Gini coefficient, indicating a potential security risk.

Tezos' Price?

Tezos trades around the $4 mark with a 24-hour trading volume of around $165 million. It has a circulating supply of 880 Million XTZ coins and a total supply is endless.

Tezos and Man United.

Crypto endorsement in sports is a growing trend. For example, blockchain firm Chiliz partnered with Spanish giants Barcelona ($BAR) to produce Barça Fan Tokens in a signature example of meeting the usage challenge.

Likewise Manchester United has announced a landmark multi-year partnership which will see Tezos, featured on the Club's range of men's and women's training shirts. According to the Man United's website, Tezos is at the forefront of the global blockchain revolution which allows for fast, secure and efficient digital interactions without the need for intermediaries.

Tezos is indeed advertised as a club partner and the likes of Cristiano Ronaldo and others appear in a promotional video for Tezos.

Crypto Sports Partnerships are projected to reach $5 Billion by 2026.

Summary

Tezos is a unique blockchain, built from the ground up by its developers. It is not based on any other blockchain by forking or building an extra layer on top of an existing project.

The stated goal of Tezos is a simple one: it wants to create a blockchain that is able to incorporate new innovations without risking a hard fork that could divide its community.

Like Ethereum, Tezos will allow for smart contracts, and it has been designed to be secure and future proof, with a decentralized community-driven consensus mechanism.