August 31, 2021 |James Messi
Beaxy Exchange adds support for Tezos (XTZ) deposits, withdrawals, and trading for XTZ-BTC. XTZ is the native token for Tezos, an open-source blockchain that supports smart contracts and Non-fungible tokens (NFTs).
What is Tezos?
Tezos entered the cryptocurrency scene in July of 2017 and completed a record-setting ICO that raised more than $230 million for the project. Tezos co-founders, Arthur and Kathleen Breitman, started building out the Tezos blockchain back in 2014.
The Tezos blockchain is a leading protocol for developing smart contracts, decentralized applications, and minting NFTs. Tezos stands apart from other smart contract platforms by deploying a liquid proof-of-stake consensus model that enables seamless self-governance.
How Does Tezos Work?
The Tezos protocol offers many useful features like self-governance, smart contracts, decentralized applications, NFTs, and more.
The blockchain itself has two core sections. These are referred to as the “shell” and “protocol” layers. The shell is the layer that implements upgrades that are submitted to the network by developers and voted on by XTZ token holders. The protocol layer contains the code that communicates with the shell layer. The protocol transfers the network’s proposed upgrades to the shell so that they can be reviewed and tested.
The Tezos blockchain is noted for its ability to avoid controversial hard forks by implementing a semi-autonomous system to manage on-chain governance. This process enables anyone that is holding the XTZ token on the Tezos blockchain to use their tokens to vote on upgrades to the protocol. To avoid hard-forks, the Tezos blockchain automatically implements upgrades that receive enough votes via the XTZ token. These individual upgrades are referred to as self-amendments.
On-chain governance and self-amendments create an incentive structure that enables the protocol to be refined with greater efficiency. The process begins when a developer on the Tezos network introduces a proposal to upgrade the blockchain. They will also submit an invoice to be compensated for their time in developing the proposed upgrade. Once the Tezos community has reviewed the proposed upgrade, they will test it through multiple rounds and provide feedback for any errors or bugs that are discovered. After a proposal is tested, voting with the XTZ token takes place. Proposals that are approved go through a process referred to as a “hot swap”. This initiates a new and upgraded protocol without creating a fork of the Tezos blockchain.
Liquid Proof of Stake
A durable consensus mechanism is vital to any blockchain protocol. Tezos leverages Liquid Proof of Stake to maintain its network. LPoS is similar to traditional PoS in that it replaces miners with validators that confirm transactions by locking tokens on the protocol. Tezos’ model is “liquid” because it shifts between direct and representative democracies.
The LPoS system requires that XTZ holders lock a number of tokens on the network to gain access to the blockchain’s consensus initiatives. XTZ token holders can then distribute their governance rights to other participants on the Tezos network. This can be done without having to fully transfer the ownership of the XTZ tokens.
The XTZ Token
XTZ is the native asset on the Tezos blockchain. The XTZ token plays a crucial role in the governance of the Tezos protocol and is primarily used for voting, baking (staking on Tezos), or spending with a vendor that accepts it.
By staking XTZ tokens in the “baking” process, Tezos users maintain their ability to vote on proposals while earning a reward paid out in XTZ that is proportional to the number of tokens that they are baking. On most blockchains, this process is called “staking”. With Tezos’ LPoS consensus mechanism, XTZ holders lock their tokens in a process referred to as “Baking”.
The XTZ token currently has a market capitalization of $3.45 billion. There are 856,663,983 XTZ tokens in the circulating supply. The maximum future supply is set at 886,556,458 XTZ. Global daily volume typically falls in a range between $100 to $400 million. The all-time low price for XTZ was made at $0.31 on December 7, 2018. The all-time high for XTZ was hit at $8.40 on May 7th, 2021.
Trade Tezos (XTZ) on Beaxy
Trading XTZ has never been easier. Seamlessly convert BTC and XTZ when you sign up on Beaxy Exchange.
On average, Beaxy Exchange traders complete KYC in five minutes or less. The cryptocurrency that you hold on Beaxy is protected by Curv’s multi-party computation (MPC) security model. Fiat currency holdings are backed by FDIC insurance up to $250,000 per account.
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