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What is Tezos?

  • Tezos is an open-source blockchain that can execute peer-to-peer transactions and serve as a platform for deploying smart contracts.

  • The Tezos network achieves consensus by using Liquid Proof-of-Stake mechanism.

  • Their ICO in 2017 was the largest up to that point, raising $232 million.

Tezos is an open-source blockchain that can execute peer-to-peer transactions and serve as a platform for deploying smart contracts, with XTZ as its native currency. The Tezos network achieves consensus using Liquid Proof-of-Stake mechanism – a variation of the classic PoS consensus mechanism and uses on-chain governance to decide on network upgrades – it can upgrade itself through an in-protocol amendment process without the need for a hard fork.

Performing upgrades in this fashion accelerates innovation, reduces the likelihood of contentious splits, and coordinates stakeholders within the Tezos ecosystem over a long period of time. This is important as the suggestion or expectation of a fork can divide the community, alter stakeholder incentives, and disrupt the network effects that are formed over time. Because of self-amendment, coordination, and execution costs for protocol upgrades are reduced and future innovations can be seamlessly implemented.

Besides using XTZ for transaction fees, it plays a central role in the governance of the network as well. All upgrades are voted on by validators “bakers” who need to hold at least 8000 XTZ to run a node and participants who do not have enough tokens are incentivized to participate in governance by delegating their tokens to a validator and earning rewards in the process.

The Tezos blockchain was created by husband and wife Arthur and Kathleen Breitman in 2014 through Dynamic Ledger Solutions, a startup they founded to develop Tezos. After years of development, they set out to launch an ICO during the crypto craze of 2017. At the time, it became the largest ICO in history, raising the equivalent of $232 million (66,000 BTC and 361,000 ETH).

Since then, Tezos has come a long way and has seen a lot of usage, particularly in the NFT space with platforms such as Rarible, Objkt, and One Of all building on top of it, not to mention games such as Dogami and Tezopia. Beyond that, there is also a growing DeFi ecosystem being built with QuipuSwap, Vortex, Plenty DeFi, and others at its core.

Many Tezos supporters prefer to not sell their XTZ and find XTZ staking to be a great way to passively earn more and help secure the network. Learn more about how to stake and earn through Omni.

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