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Highlights
- Blockchain network Tezos has seen 95% spike since the end of July.
- Its initial coin offering (ICO) began on 1 July 2017 and earned US$232 million from the ICO.
- Tezos is distinguished by its governance.
Bullish action in Tezos (XTZ) is catching the world’s attention on the back of 95% spike month-on-month. The block chain network was making headlines ever since it began ICO on 1 July 2017, which earned the network a whopping US$232 million, creating historically the largest ICO. Distinguished by its governance, the working of Tezos can evolve over time without a hard fork.
What is driving the rally?
- The Granada upgrade
On 6 August, the proof- of stake blockchain network, Tezos, went live with its seventh upgrade - the Granada upgrade. The upgrade included an improvement in terms of block time halved from 60 seconds to 30 seconds. This is a result of the switch from the earlier Emmy+ consensus algorithm to Emmy*.
In addition, it brought about a three to six times (average factor) reduction in gas consumption by smart contracts. This is useful as developers can deploy better applications on Tezos at a feasible cost. The upgrade also brought along liquidity baking that mints a small amount of XTZ every block and deposits it within a constant product market- making smart- contract. This incentivises significantly sized liquidity provisions between XTZ and Tezos token, tzBTC. Liquidity baking is key because to aid the widespread usage of Tezos, the availability of low slippage exchange of tez into other currencies and vice versa is important.
- Adoption by large banks
The upswing in Tezos was also aided by two significant players. Crypto Finance AG, a digital asset firm and InCore, a Swiss business- to- business transaction bank, announced the launch of a new tokenisation tool on this network. To enable smart contracts functions like AML capabilities and asset governance to support financial markets, the companies have come up with DAR-1 token standard for asset tokenisation.
InCore has also stated that it would introduce institutional-grade storage, staking, and offer trading services for XTZ. This would allow financial establishments to provide staking services for their consumer’ assets.
- Captivating staking rewards
Tezos has also benefitted from the removal of several tokens from circulation to aid perform consensus for staking rewards. As per StakingRewards data, 7.85% token holders delegate their XTZ while the tech savy holder can earn 8.73% by launching own Tezos bakery.
Conclusion
Tezos co- founder Kathleen Breitman mentioned hitting 10 million contract calls in the network, of which 5 million contract calls were recorded in past eight weeks, as mentioned in an interview with Forbes dated 24 August 2021.
This surge in contract calls as quoted by Kathleen Breitman is indicative of the explosion in the usage of the network mainly driven by the increased demand for non- fungible tokens.
In the interview, she further mentioned about working on two unannounced projects along with a new website called Play with BRIO that uses Tezos as a currency for buying and selling gaming. With more new projects in the offing, it would be interesting to see how the future unravels for Tezos.
Related reads: What are non fungible tokes?
