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Comment by simias | Hacker News Reader

His experience is what I would expect from anybody trying pre-alpha software which is probably what IOTA is right now (at least, that seems to be the common defense from it's proponents, "it's temporary, it's going to change"). The absurd part is that it's pre-alpha software that has a market cap in billions of dollars thanks to the wild speculation around cryptocurrency/blockchain stuff.

I mean, the simple fact that IOTA currently de-facto centralized, doesn't plan on using PoW to secure the chain and promises almost-free transactions should make investors very cautious. They're promising what nobody has managed to achieve yet and the only thing they have to show for it is a whitepaper and the promise that very clever people are working on it.

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Before we get to the fact that it's effectively poorly written pre-alpha garbage, let me make something abundantly clear:

There is no IoT use case for IOTA.

Let me repeat that.

There. Is. No. IoT. Use. Case. For. IOTA.

I'm not having a pop at the parent here, I just want to make it clear that there is no reason for IOTA to exist.

IOTA not only fails to solve a problem, it's failing at solving a problem that IoT doesn't have.

I'd be interested to see an actual application of IOTA for any IoT device that can only be, or is optimally solved by IOTA.

But there isn't one.

Because there's no freaking use case that can't be done more optimally using already production-level alternatives.

How do you allow machine to machine payments in a trustless manner without some sort of value transfer protocol? How do you make these transactions with periodic internet connection? Are you saying IoT devices will not need to pay each other?

In the finest blockchain tradition, this posits a convoluted solution that doesn't work, to a problem that nobody actually has.

So, IoT devices will not need to pay each other? No need to repeat a point without actually adding anything new to discussion. Companies are reaching out to IOTA, perhaps you should tell them their desire for this technology is irrational?

Additionally, while IOTA is designed for IoT, it will obviously work with non-IoT devices. If IOTA works, there is no need for many other cryptos to exist.

> Companies are reaching out to IOTA

In all the cases so far that IOTA put forward of this happening, the company came back denying it.

That is false. Either you are not doing your own research, or you are intentionally spreading misinformation.

> How do you allow machine to machine payments in a trustless manner without some sort of value transfer protocol?

Can you explain to me why this is needed? I genuinely can't think of instances where machines need to pay each other, let alone in a trustless manner vs a centralized solution. People, sure. Machines, no. I'm not trying to be difficult, I've spent weeks trying to think of a situation I've worked on within the IoT space where the machines need to pay each other and haven't been able to come up with one.

> How do you make these transactions with periodic internet connection?

Again, why would you make such transactions with periodic internet connections? What is the size of the market for semi-connected IoT devices to bill each other, as opposed to the organisations or people using them?

> Are you saying IoT devices will not need to pay each other?

I'm not saying that. I genuinely haven't been able to think of a situation where a decentralized payment mechanism is necessary. I'll give you a quick rundown of some of the things we can consider IoT that I've done security work on over the past 15 years, and perhaps you can give me some use cases where decentralized machine to machine payment is needed.

1. Process control system for natural resource management - so there's pipes, stuff going through the pipes and PLCs managing the flow.

2. Home routers connected to the Internet with Wifi networks (Think Linksys etc)

3. The Sphero Spiderman kids toy (This was for a third-party, I didn't work for Sphero on this).

4. An Internet-capable TV running different apps like YouTube, Vimeo etc.

5. An in-car location tracking device used to reduce car insurance payments based on speed, areas driven in and types of road driven on.

I can kind of see some sort of situation where some of the above might have payment integration useful, but none where it needs to happen on the device itself. If you have any use cases for IOTA where a centralized alternative won't beat it or doesn't already exist, I'd genuinely love to know. It's my biggest stumbling block.

Are you familiar with the term "fog computing?"

This is one of the main reasons for which IOTA was created. The term was invented by Cisco and since then there has been a lot of effort to come up with a solution.

How do you achieve fog computing with no means of transaction of value? Devices will need to pay each other for resource sharing, be it computing power, storage, data, or electricity. Your neighbors will not provide resources to you if you cannot pay them.

The problem with centralized payment systems is that they are not permissionless. If you hook your IoT device to your VISA card, your device needs to establish a connection with VISA every time it needs to make a payment, and you need your counterparty to accept payments from VISA. In addition, a large percentage of IoT transactions will be microtransactions. A centralized payment system will have to process insane amounts of transactions whose value are << $.01. IOTA flash channels allow for the streaming of data and payments in real time.

A unique property of IOTA is that it is partition-tolerant. Offline nodes can form local subtangles and attach them to the main tangle once internet connection is restored. This is impossible with a centralized payment system.

Finally, IOTA is just as much a data transmission protocol as it is a payment protocol. Data transmission on the tangle helps data become more tamper-proof, another important issue in the world of IoT.

"doesn't plan on using PoW to secure the chain" - IOTA uses PoW to secure the network (it's not really a chain), that's exactly how the network is secured. Every transaction performs a small PoW.

"the only thing they have to show for it is a whitepaper" - say whaaat? IOTA is a functioning digital currency with feeless transactions. You can watch the transactions on the network here: https://thetangle.org/live

Why would something that is "pre alpha" be worth billions of dollars? Just doesn't make sense. IOTA has no utility today.

That was my point yes, sorry if I was being unclear. Thank you for your articles by the way, they're always insightful. It's nice to see somebody actually using those cryptocurrencies instead of merely speculating about them.

IOTA has no utility today. Neither does any crypto. Neither does the Boring Company. Yet they all have value.

It's foolish to think IOTA is worth nothing even though it is not production ready, because when it is, it will be worth much more than it is today.

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