IOTA’s Data Marketplaces Tap into the Crypto World’s Trading Culture
Could the price of IOTA (MIOTA) reach $5 before the end of 2018? For those at the heart of the project, the answer is a resounding yes. After forging new partnerships with the Norwegian University of Science and Technology (NTNU) and Nordic Semiconductors, the non-profit is now looking to increase the utility of its Decentralized Acyclic Graph (DAG). As we’ve seen over the last 18 months, cryptocurrencies are often forced to live and die by the whims of traders and casual investors. Despite many of the leading projects offering a chance to change the way we process data and handle control of large networks, the value of Bitcoin, Litecoin, et al, is largely determined by media hype.
The Price of Cryptos is Based on a Buy/Sell Culture
Indeed, when an announcement is made, traders rush to buy or sell based on the weight of what’s been said, rather than what’s been demonstrated. The result is a shift in price purely because more people are buying and selling. Perhaps the best example of this in recent months is Ripple. For all its promise, we’re yet to see xRapid proven on a commercial scale. Yet, despite the lack of evidence, the price of XRP has continued to fluctuate. In reality, this dynamic is unsustainable. For blockchains to live on, they’ll eventually need to show they’re a valuable mainstream tool. Only when this happens will prices stabilize and movements be based on more than hype.
However, until the next wave of breakthroughs, playing the trading game seems to be the way to buoy the financial health of a crypto. This fact hasn’t been lost on the IOTA team. In announcing its latest partnerships, the creators explained that the deals will allow them to set-up data marketplaces. Under the new system, students at NTNU will be able to use internet-enabled devices on the Nordic Semiconductors network to mine data. By using the devices, students will be helping to solve real-world problems and, in turn, generating data on the IOTA platform. This data can then be bought and sold in the new marketplaces. Essentially, what IOTA is doing is tapping into the culture of buying and selling that’s swept across the crypto industry in recent times.
Tapping into a Cultural Norm
By allowing students to use internet of things (IoT) devices to earn credits which they can then buy/sell like a real trader, IOTA is, in a way, setting up its own exchanges. This should do two things. Firstly, as more people use the system, IOTA will be able to see how its decentralized platform processing data between IoT devices in real-time. This should help identify any flaws and improve the platform as a whole. The second area this dynamic will address is the value of MIOTA. By turning data into a commodity, it gives IOTA’s digital token a value outside of the network. In other words, instead of just being used to facilitate the transference of data, MIOTA will also have value as a tradeable asset.
Of course, the fate of IOTA doesn’t hinge on these announcements alone. In March, the fledging project announced details of its Trinity wallet development schedule as well as listings on Omoku and Bitfinex. Since then, the IOTA hub was launched as a way to improve the data transfer process between crypto exchange service providers and users. If that wasn’t enough, Fujitsu announced it was using IOTA to improve its audit trails. Like all projects, these announcements are all part of the development process. However, it’s interesting to see that the team have pinned their hopes of a $5 MIOTA price tag on a system that plays on the idea of buying and selling. Even though the data marketplaces aren’t quite the same as cryptocurrency exchanges, the premise is the same.
An Interesting Way to Generate Some Buzz
By tapping into this idea of creating value through trades, the team is hoping to generate the sort of buzz that saw the price of Bitcoin skyrocket at the tail-end of 2017. Clearly there is more to the recent partnerships than this. By pushing more data through the platform, IOTA will become a more effective way to connect IoT devices via a decentralized network. However, when you look beyond that, the creators are clearly playing into a cultural norm. Whether or not that’s a good thing remains to be seen. With a current value of $0.54 (September 27, 2018), there’s a long way to go until MIOTA is worth $5. However, if the data marketplace concept can replicate what we’ve seen on the leading exchanges in the last year, it may just create the buzz IOTA needs to move to the next level.
*Any information in this article should not be taken as investment advice.