Tezos cryptocurrency managed to earn the status of one of the most discussed. The project periodically finds itself in the center of heated debates, it is compared to financial pyramids and even accused of fraud. But the question remains - why did the Tezos developers spend so much time improving their technology.
The project is a blockchain network for working with decentralized software and smart-contracts technology. The developers did not hide the code of their brainchild - it is freely available. Anyone with knowledge of cryptography will be able to contribute to the development of the network.
The Tezos structure is multistage. This solution allows you to update protocols and the entire network without the use of dangerous hard forks. The platform is divided into three main parts: the network structure, the transaction mechanism and the consensus system.
Before the release of Tezos, the virtual world did not know about full formal verification. The solution was a novelty for the crypto community and was supposed to take security to a new level. Cryptocurrency excludes errors that are theoretically possible on other platforms. The program code is written in the Ocaml language, which allows you to carry out system work without stopping the network.
The main features of the Tezos cryptocurrency:
Your own virtual machine, different from the classic Ethereum.
Layer-by-layer platform update without risk of error.
New programming language that expands the capabilities of the system.
Application of a new method of transaction confirmation.
The founders positioned Tezos as a new virtual community, a group of network members with common interests. The cryptocurrency aims at shared decision making by all users. According to the developers, a "friendly" approach can significantly improve the platform.
According to Kathleen Breitman, co-founder of Tezos, the system is significantly different from other virtual coins. The presence of Michelsons personal language for processing smart contracts simplifies the order verification process, but the security remains at its best.
Tezos is one of the few cryptocurrencies that pays a lot of attention to formal verification. It is a mathematical algorithm capable of correcting itself. Such solutions are found not only in the world of virtual money, for example, the aerospace industry widely uses formal code verification in aircraft, where the cost of error is too high.
The creators of the platform are the married couple Arthur and Kathleen Breitman. Work on the new project began in 2011, but the official start date for development is 2014. The reason for the three-year wait is the difficulty in building a team of specialists. The founders were careful in their selection of candidates, which slowed down the writing of the system.
After resolving the organizational issues, the work began to boil: the cryptocurrency acquired a core, technical documentation was prepared, and legal issues were resolved. The ICO procedure was planned for the end of May 2017. Investor sentiment was positive, with a well-developed White Paper noted, which added confidence. The Breitmans continued to convince of good investments, quick profits and technical novelty of the idea.
However, three days before the start of coin sales, the ICO was canceled. According to the developers, the reason for the decision was related to the unavailability of the system for public work. The creator of the Tezos cryptocurrency, Arthur Breitman, specified that the transfer will not be long and will take place in the near future.
The team kept their word - an official ICO was held in July. The amount of collected funds amounted to about 232 million USD. For unknown reasons, the developers again postponed the release of the platform, and this step did not pass without leaving a trace - investors panicked, litigation began.
The test version did not save the day. Investors began to doubt the advisability of further cooperation, Tezos coins began to sell rapidly. The sharp change in the ratio caused the predicted collapse in value. Here, another oversight of the developers was revealed - the lack of a limit on the sale of coins. During the ICO, more than 80% of tokens were in the hands of clients.
In addition to a couple of Breitmans, a team of programmers worked on the project. Ryan Jespersen took over as president of the T2 Foundation, and it is only thanks to his efforts that the project still exists.
At first, the system showed all the signs of a reliable and secure platform; at the initial stages of its creation, Tezos won the trust of depositors. By the end of 2016, the young company T2 was already valued at 6 million USD; in the spring of 2017, the value of the companys assets increased to 150 million. Investors were looking forward to the ICO procedure.
But the Tezos project continued to be plagued by setbacks. Legal inaccuracies in the White Paper, inconsistencies in the documentation - the mistakes of the creators gradually accumulated. Most of the investors did not re-read the official consent of the ICO, which later played a cruel joke. All participants were focused on profit.
Polychain Capital CEO Olaf Carson noted that the Tezos cryptocurrency belongs to the first blockchain project to establish formal governance at the protocol level. The idea turned into a unique experiment, the potential of which was very attractive, but a series of founders mistakes shook the bright future of the system.
Lets note the moments that led to the loss of customer interest:
the absence of limits on assets during the ICO procedure, due to which most of the coins ended up in the hands of clients;
a strange decision of the leaders about the possibility of using Tezos tokens only 4 months after the ICO;
a series of lawsuits in the early stages of the platforms development;
mass sale of coins after the launch of the beta version of the platform.
The combination of the "strange" decisions of the Breitmans caused a sharp drop in audience interest.
The goals of the crypto platform were initially positioned as:
building the best blockchain;
solving the most common problems of existing cryptocurrencies;
providing a full-fledged alternative to the Ethereum protocol;
providing customers with improved smart contract technology.
From the list of goals, it can be seen that the creators planned to solve most of the technical and political problems associated with the use of crypto assets in different countries.
Tezos is now presented to the public as a digital community of enthusiasts who make personal decisions for the development of crypto. Members have the right to personally propose changes to the platform. If the idea is approved by the audience, it is included in the next release of updates, and the author is rewarded in system currency.
Tezos was largely created as a real alternative to Ether. The coin aims to provide favorable conditions for the creation of decentralized applications. The model of operation is proof of price with a regulated protocol. All approved decisions are posted on the official website and are publicly available.
Another goal of creating Tezos is to reduce or completely eliminate the impact of hard forks that have a negative impact on crypto platforms. Volatility, sharp drops in quotes, a split in a single platform are a consequence of the influence of hard forks. A striking example is Ethereum, which, after the unsuccessful launch of the DAO, underwent a split into two branches and today has many unnecessary "tails".
A large number of crypto platforms are based on the bitcoin transaction processing algorithm, which is not without its drawbacks. Tezos applies a modified DPoS validation scheme - delegated stake verification. The use of this type made it possible to introduce Gouvernance - voting by participants for changes in the platform.
DPoS improves packet processing speed. As a result, Tezos transactions are faster, while the load on the network does not exceed the permissible parameters. Additionally, coin holders can transfer the right to vote to other participants, the only condition is that the participant must be the custodian of the XTZ in-system coins.
The creation and authentication of blocks is called baking - an analogue of mining in the Bitcoin environment. Bakers are an irreplaceable link in the PoS chain, their task is to provide a guarantee of the correctness of the transaction and the correctness of the information in the data block. Bakers automatically monitor the absence of Double Spending attacks. Nodes are not recommended to engage in deception - otherwise, the network will automatically deprive the asset of the dishonest participant. The platform rewards bona fide bakers with coins.
Any owner of XTZ assets can actively participate in the transaction validation procedure. The procedure is carried out by replenishing a personal deposit, and as a result, the participant receives a reward that compensates for his expenses.
The validation principle is simple: the block is “sealed” by one baker and 32 other participants check the data and confirm the validation.
Any coin holder can thank the validator by sending him a certain amount, for which the baker forms a new block for the participant.
Currently, Tezos rival, Ethereum, is actively working on implementing a PoS scheme, while Tezos is already using this algorithm. The current model of Ether PoW is quite resource intensive for peer-to-peer networks. On the contrary, PoS does not require physical costs (electricity); verification is carried out by the intellectual capacities of the platform.
To improve the processing of transactions, the cryptosystem uses an individual Michelson code. The language implements a formal check function using a mathematical analysis of the algorithms performance. The developed methods allow identifying weaknesses in the code and fixing them in time. Michelsons big plus is automatic analysis without direct human intervention.
The entire project is written in Ocalm, which expands the platforms capabilities, but makes it harder to implement updates due to the non-prevalence of the language.
The project was created with good intentions and against the background of loud statements from the developers, the future of the Tezos system seemed very bright. Most of the issues that have arisen as a result of the activity are related to the implementation of the platform, and in technical terms, the crypto platform has stood still for a long time, although recently there have been shifts. The main trouble is the split of Tezos into two branches, Tezos itself and nTezos: what the developers were struggling with was formed inside the platform.
The split is related to the decision of the US regulators. The company went through a lot of lawsuits, according to which the T2 Foundation is obliged to disclose the identity of all investors. The KYC procedure carries a hidden nuisance for depositors - there are doubts whether the majority will want to stay with Tezos after identifying their identities.
Participants will have to choose whether to stay with the virtual coin, but reveal personal information, or switch to the unstable nTezos and maintain the confidentiality that the founders claimed.
Against the backdrop of a lot of litigation and close monitoring of Tezos by American lawmakers, a reasonable question arises - will privacy remain on the platform at all? There is no definite answer.
However, you shouldnt write off the project. Despite all the difficulties, the coin managed to stay within the acceptable price range. The current rate of the Tezos cryptocurrency is located in the zone of 1.50-1.52 USD, the amount of XTZs market capitalization is 1.148 billion USD and the platform cannot be called hopeless - at least the technical filling of the system is well developed.
Many analysts agree that there are no signs of an independent collapse of the XTZ coin. Asset holders are in no hurry to sell the last coins and expect to make a profit. The income is quite real - due to well-thought-out algorithms and technical prospects, Tezos can recoup all the negative moments that have occurred during the existence of the coin.
Added: 30.11.1999 
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