IOTA Tangle 2.0: Toward a Scalable, Decentralized, Smart, and Autonomous IoT Ecosystem

IOTA Tangle is a distributed ledger technology (DLT), primarily designed for Internet-of-Things (IoT) networks and applications. IOTA Tangle utilizes a direct acyclic graph (DAG) structure for the ledger, with its protocol offering features attractive to the IoT domain, over most blockchain alternatives, such as feeless transactions, higher achievable transactions per second (TPS), and lower energy consumption. The original IOTA implementation relied on a bootstrap centralized coordinator solution for consensus which limited its degree of decentralization and scalability. This concern, alongside other limitations to its adoption, such as lack of smart contracts, are being addressed with the release of IOTA 2.0. This update brings with it significant changes in order to remove the coordinator and achieve a scalable decentralized solution. To this end, this paper provides a technical overview of the key features of IOTA 2.0 while discussing their relevance and benefits for the wider IoT ecosystem. The paper also provides performance insights and future research directions for IOTA 2.0.