What is Tezos?

Tezos is an open-source, public blockchain protocol that uses a low energy consumption and energy-efficient consensus. The protocol uses a self-amending governance system in which the protocol cannot be hard-forked as it continues to make changes to its existing framework.

The Creation of Tezos

The main weaknesses of Bitcoin and Ethereum were thought to be:

In August and September 2014, Arthur Breitman released the Tezos' Position Paper and White Paper, using the "L.M Goodman" pseudonym.

Arthur's goal was to keep the advantages of other blockchains and to overcome their existing drawbacks and defects.

The Company OCamlPro was hired by Arthur Breitman and they developed a Tezos prototype from March 2014 to July 2017. Thus, Tezos was founded and written in their preferred language - OCaml, an esteemed programming language in research.

Main Take-aways of Tezos

Self-Amendment & On-Chain Governance

Self-amendment enables Tezos to upgrade itself without splitting (“fork”) the network into two different blockchains. This is important as the suggestion or expectation of a fork can divide the community, alter stakeholder incentives, and disrupt the network effects that are formed over time. Because of self-amendment, coordination and execution costs for protocol upgrades are reduced and future innovations can be seamlessly implemented.

On-Chain governance enables all stakeholders to participate in governing the protocol. The election cycle provides a formal and systematic procedure for stakeholders to reach an agreement on proposed protocol amendments. By combining this on-chain mechanism with self-amendment governance, Tezos can change this initial election process to adopt better governance mechanisms.

Smart Contracts & Formal Verification

Tezos offers a platform to create smart contracts and build decentralized applications that cannot be censored or shut down by third parties. Furthermore, Tezos facilitates formal verification, a technique used to improve security by mathematically proving properties about programs such as smart contracts. This technique, if used properly, can help avoid costly bugs and the contentious debates that follow.

Liquid Proof-of-Stake (PoS)

Participants (“nodes”) in decentralized, peer-to-peer networks provide the necessary computational resources that keep a network up and running. Proof-of-Stake (PoS) is the mechanism by which the various participants in Tezos reach a consensus on the state of the blockchain. Unlike other PoS protocols, any stakeholder can participate in the consensus process in Tezos and be rewarded by the protocol itself for contributing to the security and stability of the network. Additionally, PoS is less costly than other consensus mechanisms and lowers the barriers to entry for involvement.