Despite facing several lawsuits in its early years, Tezos, one of the famous blockchain projects that successfully conducted an initial coin offering (ICO), baked its one-millionth block this week. Although Tezos had a rough start, with delays in network launch, the Swiss-based cryptocurrency project arguably has one of the best-performing projects and digital currency (XTZ) this year.
The Journey to 1,000,000th Tezos Block
Upon beta launch on June 30th, 2018, Tezos block production and validation were first managed by the Tezos Foundation, a Switzerland-based non-profit organization in support of the Tezos protocol and ecosystem, for approximately three weeks.
Calculatedly, the Tezos Foundation handled Tezos block production for seven cycles and baked 28,672 blocks. A cycle is reached at 4096 blocks/levels, which occurs at approximately three days.
The first non-Tezos Foundation block was produced by a third-party validator or baker after the first three weeks of the Tezos launch. Tezos’ term for block creation is known as ‘Baking’ (to be discussed later in this article), and a participant in this baking process is referred to as a ‘Baker.’ Thus, the first Tezos block to be baked by a baker was on July 21st, 2018.
A glance at the number of Tezos’ baked blocks showed that the one-millionth block was baked at 01:28 UTC according to data from block explorer, tzstats.com.
The baking of Tezos’ one-millionth block marks a milestone in an eventful journey, as numerous developments have been announced within the Tezos ecosystem since the network went live.
Besides, its cryptocurrency traded with the ticker, XTZ, has grown to become one of the top altcoins with the highest buying interest, and demand rising relatively across exchanges. In May, Coinbase said its users bought more Tezos than other altcoins, including Ether (ETH).
What is Tezos And How it Began
Tezos is a decentralized blockchain and cryptocurrency platform that runs on a delegated proof-of-stake (DPoS) model. Tezos is built on OCaml, a computer programming language that offers flexibility and formal proofs of correctness. Its mode of operation enables stakeholders to control certain activities on Tezos, by voting on amendments for the network.
Also, Tezos blockchain is self-amending, meaning that it can upgrade itself over time, as it follows a formalized process for proposing, selecting, testing, and activating protocol upgrades, while still avoiding hard forks. In addition to supporting Turing complete smart contracts, Tezos features formal verification, which would allow developers to validate the correctness of smart contracts code. In this way, Tezos prioritizes security.
What is Tezos Baking?
Baking in Tezos refers to the processing of signing and publishing new blocks/levels in the chain. As mentioned earlier, Tezos runs on a delegated PoS consensus mechanism, meaning that anyone (baker) that will publish a block to the chain would be selected based on the total stake they control. With that in perspective, a baker needs up to 10,000 XTZ to qualify as a delegate.
Delegation in Tezos enables users who do not wish to participate in baking, to delegate their staking power to other users. With additional delegated stakes, a baker gains a higher chance of publishing the next block, which comes with a reward.
Bakers receive 16 XTZ as a block reward with blocks baked appr. every 60 seconds except on a few occasions when a baker goes offline. The Tezos network also involves 32 endorsers, who would be selected randomly to validate the previous block, with 2 XTZ as the block endorsement reward.
Tezos Development, ICO, and Lawsuits
Tezos was founded by Arthur Breitman – who is experienced in the field of computer science, mathematics – together with his wife, Kathleen Breitman. They released the Tezos whitepapers in 2014, which introduced Tezos as a peer-to-peer (P2P), distributed, and permissionless network, which will be based on smart contracts.
While still working at Morgan Stanley in 2015, Breitman established Dynamic Ledger Solutions (DLS) in Delaware, acting as the company’s Chief Executive Officer (CEO). The company was responsible for Tezos’ intellectual property, including its logos, domain names, Tezos’ source code, and other trademark applications associated with Tezos. Tim Draper held a minority stake in DLS after he invested $1.5 million in DLS through Draper Associates, prior to the ICO.
After a failure in 2015 to attract investors for the Tezos project, the Breitmans planned to raise funds by conducting an ICO in Switzerland, reportedly around September 2016, which resulted in the formation of the Tezos foundation, with Monetas’ Johann Gevers as the president. The independent foundation was formed to handle the planned ICO, which is in accordance with Swiss law, according to Reuters.
Tezos’ Successful ICO
Initially, the ICO was scheduled to hold in May 2017, and the Breitmans expected to raise $20 million, upon high participation.
Fortunately, the Tezos foundation ended up garnering over ten times the amount through the ICO, which later began on July 01st, 2017. They reportedly raised about $232 million (a record for an ICO then), which was received through Bitcoin (66,000 BTC) and Ether (361,000 ETH), under a term which relayed that the funds are not “speculative investment,” and also a non-refundable donation.
Despite the successful Tezos ICO, however, a dispute broke out between the founders of Tezos, the Breitmans, and the president of Tezos Foundation, Johann Gevers. This resulted in more problems for the Tezos project, which later caused the dismissal of Gevers with at least $400,000 in severance. Consequently, the dispute delayed the launch of the Tezos network, which also brought more lawsuits as the investors sought a refund.
Tezos Betanet and Mainnet Launch
After the delays, the Texas foundation finally announced the launch of the Tezos network on beta, precisely on June 30th, 2018. All the transactions processed in the Betanet would persist to the mainnet once it goes live. At that time, Tezos urged users to secure their cryptocurrencies probably, as a loss or theft of XTZ would result in permanent loss.
Later on September 17th, the Tezos mainnet was launched, marking the end of the project’s beta stage.
The Tezos foundation said in an announcement then:
As a result, we now consider the beta period concluded, and while active development still continues, we are pleased to regard the Tezos network as the mainnet.
Tezos (XTZ) Historical Price Performance
A Tezos token is dubbed ‘TEZ,’ and ‘TEZZIES (in plural), however, they are traded with the ticker, XTZ. Even in the betanet, the cryptocurrency was reportedly tradable on different exchanges such as HitBTC and Gate.io. At that time, it saw relatively high demand and was named as one of the most traded cryptocurrencies on Gate.io exchange.
According to CoinGecko, a cryptocurrency market data provider, Tezos has yield investors a history ROI of 456.8 percent. Its all-time high (ATH) was recorded four months ago, precisely on February 19th at the price of $3.91.
The all-time low (ATL) happened over one year now, when XTZ traded at $0.350476, on December 07th, 2018.
So far, the cryptocurrency has grown to become the 12th largest digital currency with a market capitalization of $1,864,377,046, and a market dominance rate at 0.70 percent, which many who know about the project’s rough start will consider a significant achievement.