IOTA aims for complete decentralization with Rebased

May 5, 2025, will mark a historic date for the blockchain ecosystem: the IOTA network is preparing to complete an unprecedented upgrade, transforming into a fully decentralized, scalable platform ready to handle a wide range of Web3 applications. The arrival of the new protocol, IOTA Rebased, indeed promises to revolutionize the network’s operation, strongly pushing for real adoption and the usability of its $IOTA token.

A monumental step for IOTA: the evolution of the protocol

Since 2015, IOTA has undergone several technical transformations to meet the growing demands of the blockchain ecosystem. With the IOTA Rebased protocol, the most complex and decisive update ever faced arrives. After months of technical testing, auditing, and community governance-based decisions, the network will finally become a decentralized Layer 1 blockchain, based on a Delegated Proof-of-Stake (DPoS) consensus mechanism.

This structural change not only strengthens the reliability of the network but also forms the basis for new opportunities related to decentralized finance (DeFi), on-chain exchanges, digital identity, and systems for supply chain traceability.

The key innovations of the new IOTA Rebased

With the official launch of the Rebased protocol, IOTA introduces innovative technical features that enhance the network in every aspect.

Extreme performance: 50,000+ TPS and finality under 500 ms

One of the elements for which IOTA Rebased stands out is the adoption of the Mysticeti consensus protocol, capable of processing over 50,000 transactions per second with a finality of less than 500 milliseconds. This makes IOTA one of the most high-performing networks overall, ideal for real-time and large-scale applications.

Native smart contracts with MoveVM

A further advancement consists in the integration of Move-based smart contracts directly on Layer 1. IOTA thus becomes the third network in the world, after Sui and Aptos, to adopt MoveVM, an environment that offers greater security and modularity to developer interested in building advanced dApps. This native presence of smart contracts will enormously strengthen the solidity of Web3 applications developed on IOTA.

A truly decentralized network

The adoption of the Delegated Proof-of-Stake system will lead to the introduction of 50 permissionless validators at launch, set to progressively grow to reach at least 150 validation slots. This will make IOTA one of the most decentralized blockchains in the current landscape, with a wide and balanced distribution of validation power within the ecosystem.

Staking arrives on IOTA

For the first time in its history, the network will offer rewards for users who stake their $IOTA tokens. Network participants will receive an annual yield between 10% and 15%, encouraging active participation and contributing decisively to the overall security of the network.

Minimal commissions and fee-burning mechanism

The new protocol introduces low and adaptive transaction fees, supported by a fee burn module designed to balance the inflationary and deflationary dynamics of the $IOTA token, maintaining a sustainable supply balance over time. Additionally, with the introduction of the IOTA Gas Station feature, developers and companies will be able to cover operational costs on behalf of users, ensuring a completely transparent user experience.

The network of validators and the future of the IOTA EVM

At the start of the Rebased protocol, a network of initial validators — called Genesis Validators — will come into operation to ensure the correct activation of the system. Among these, well-known entities such as the IOTA Foundation, Tangle Ecosystem Association, and industry players like Stakin, Luganodes, Twinstake, and Nansen are included. In parallel, the IOTA EVM will also be reactivated, ensuring compatibility with the Ethereum ecosystem and allowing the execution of traditional smart contracts. Decentralization will be progressively enhanced until the set goal of at least 150 independently operating validators is reached.

Impact on the real world and opening to institutional investors

According to Dominik Schiener, co-founder and chairman of the IOTA Foundation, “creating real value has always been our main goal.” With the introduction of this new version of the network, IOTA aims to attract institutional investors, governments, and large companies, strengthening its presence in strategic areas such as tokenization, digitalization of trade, and trade finance.

With its new and modular infrastructure, IOTA is ready to enhance real-world applications such as supply chain management, smart energy systems, and secure digital identities. All this without sacrificing the fundamental pillars of scalability and decentralization.

IOTA confirms itself as a leader in the evolution of Web3

With a solid network and established experience in industrial and governmental projects, IOTA positions itself today as one of the most mature and concrete Layer 1 blockchains on the global scene. Founded in 2015 as an open-source project, over time it has managed to build an infrastructure capable of combining efficiency, security, and openness. The support of international non-profit entities such as the Tangle Ecosystem Association and the IOTA Ecosystem DLT Foundation further underscores the project’s ongoing commitment to fostering sustainable and decentralized technological development.

The Rebased protocol is therefore not just a technical update, but a true leap into the future for IOTA, already poised for a new era of global adoption — both for companies and governments — through increasingly advanced, useful, and secure Web3 applications.