Unlike most cryptocurrency ratings published online, the Wise Crypto ratings have nothing to do with the current or future price of the currency. Whether or not a crypto is over or undervalued or priced today is completely irrelevant. Our research focuses on the sustainability of each project, the security, the use case, decentralisation, environmental impact, the technology, the scalability and the developers and teams behind the projects.
Tezos (XTZ) Rating = 365/1,000
Technology (0 to 300) = 105
- Speed (0 to 50) = 5
Currently, the throughput in the Tezos network is approximately 30-40 transactions per second. That is quite low considering its peer top flight cryptos that can achieve higher throughput. This speed is not at a rate that can actually drive its mass adoption. Kraken lists the average deposit time at 30 minutes.
- Cost (0 to 50) = 5
Tezos doesn’t rely on transaction fees as a source of income. For that, the fees are set to almost zero, ranging from US$0.0001 to US$0.0007. The fees are that low because rewards for baking and endorsement govern the node incentives. However, the team plans to treat the transaction fees as meaningful when the network gets congested. That would prompt the bakers to prioritize transactions by setting high transaction fees.
Right now, Tezos has a small community, but if they get to a larger scale, more transactions are expected, which will most certainly congest the network. This is a see-saw kind of situation where its users hope for more people to join the network but worry the transaction fees would go up if that happens. So, no points for Tezos there.
Withdrawal and transaction fees on Binance are 0.5 Tezos at the moment meaning roughly $0.40
- Scalability (0 to 50) = 10
Tezos promises an ever-developing infrastructure for its scaling capabilities. The fact that it is a self-amending chain, it means that Tezos can adapt the newest technologies and that includes scaling. There is no maximum potential since Tezos infrastructure is flexible. It is no doubt it would rank among the top scalable cryptos in the market.
Curently, Tezos scalability is in its capacity to offer PoS from launch (more Tx/s vs. PoW). More, its self-amending ledger allows for smooth and optionally quicker rollouts. This seems rather simple but has been effective to give the network an edge over most cryptocurrencies.
The only factor that could hamper its scalability status would be its blockchain throughput. A 40 tps speed is not fast enough to allow the network to process a high amount of transactions on the network
- Reliability (0 to 50) = 25
With a powerful and flexible network at its core, Tezos drew huge attention in its initial coin offering. The ICO began on July 1, 2017, and went on to earn $232 million, making it one of the biggest ICOs of all time.
Studying the experience of Ethereum, Tezos developers decided to avoid hard forks by utilizing a protocol that’s capable of self-amendment. This allows for automatic platform updates which greatly improves reliability, while also reducing protocol coordination expenses.
However, since its protocol can be tweaked anytime during an update, that would mean its community will have to be constantly follow everything that goes on in the project. That is super exhausting, especially for investors who have a couple of more other coins in their portfolio.
- Environmental Impact (0 to 50) = 40
Tezos supports advanced smart-contracts just like Ethereum does. It distinctly relies on a pure Proof-of-Stake design dubbed “Liquid Proof-of-Stake”. This translates to a minimal environmental impact as it is capable of reducing its carbon footprint radically.
- Decentralisation (0 to 50) = 20
Governance of decentralized networks is a debated subject revolving the community on whether they are prioritized or not. Tezos is one of the first protocols to implement an on-chain mechanism from the get-go. This means that decisions on how the protocol should develop are taken through votes by coin holders. But then, as earlier stated, bakers have the mandate to set high transaction fees when the network is congested. That means its community who will be on the receiving end, have no say on this at all.
Security (-250 to 0) = -80
- Reorg, 51% & Brute Force Attack (-100 to 0) = -20
Currently, about 80% of the XTZ tokens are actively used for baking/staking, making the supply of XTZ circulating and available for trading to be quite low. For that reason, it would be very difficult for anyone to perform a 51% & brute force attack on the network.
- Potential for Being Banned (-100 to 0) = -25
XTZ is not a privacy coin and doesn’t rely on demanding and cumbersome proof of work. Developers also work closely with governments, central banks, and other regulators. Hence, the project is not likely to succumb to bans and restrictions. On the other hand, despite posing a promising future, the current infrastructure of Tezos is somewhat unstable as it is still subjected to constant updates. This puts the project’s stance in the future at a fence; it could either nourish or head for the worse. Only time will tell
- Network Vulnerabilities (-50 to 0) = -35
The XTZ network has had its fair share of network vulnerabilities. The most recent is “Blind Signature” attacks that affected popular XTZ wallets such as TezBox Wallet. Developers have since fixed the issue by adding a code that defends against potential malicious full nodes. They have added the feature of verifying the JSON data that the full node returns to the wallet. Why didn’t they do that from the start?
Use Case (0 to 500) = 260
- Initial Main Use Case (0 to 100) = 60
Tezos was developed with the intent of improving the older blockchain protocols like those of Bitcoin and Ethereum. Most issues derailing the capabilities of blockchain revolve around scalability. Tezos has not only improved on that sector but also solved it and still leaving room for future improvements on its infrastructure.
Tezos may have launched just a year ago, but it has surely caught the eye of many states. This July, Brazil’s fifth-largest bank, BTG Pactual, announced that they plan to utilize the of blockchain Tezos for security token offerings (STO) that could worth $1 billion. This is a big deal “deal” for the market. Aside from that, a French minister also recently applauded Tezos as a promising blockchain project, and the Bank of France confirmed that they are doing tests on Tezos node.
- Mainnet Live (0 to 200) = 200
Tezos launched a mainnet, or live blockchain version of its software at the end of September 2018. With the mainnet launch, its tokens (XTZ) also went live and are tradable now on many reputable exchanges. The coin total supply is 801,312,599 XTZ and 660,373,612 XTZ are in circulation. That is more than three-quarters of all XTZ circulating despite having a small community (users).
- Additional Use Cases (0 to 100) = 0
- Additional Working Products (0 to 100) = 0
Apart from being most preferred for STOs, Tezos’ Michelson (its smart contracts programming language) is perceived conducive for financial institutions. Michelson provides formal verifications accurately and in a high level of assurance which is vital when completing financial transactions. Tezos smart contracts offer credibility for parties involved in the e-commerce industry as well as expand the kind of transactions they can make.
However, for a project that can be molded to fit into any use-cases in the fintech industry, it should have more working products.
Core Team, Partnerships & Developers (0 to 200) = 80
- Core Team & Developers (0 to 100) = 30
The co-founders of Tezos comprises of spouses, Arthur Breitman and his wife, Kathleen Breitman. Tezos’ whitepaper was released in 2014, and the project has grown ever since.
The team behind Tezos have made sure its mainnet has been running successfully since 2018 without major problems while baking continues to mature.
Towards the end of last year, Tezos Lead architects formed a new research and development company known as Nomadic Labs. Nomadic Labs team will be focused on the development of the Tezos core software as well as its smart contract language, Michelson.
- Partnerships (0 to 100) = 50
As mentioned earlier, Tezos had recently signed a $1 billion contract with Brazil’s Banco BTG Pactual and Dubai assets management firm Dalma Capital. Also, since the Bank of France is testing Tezos nodes, a future partnership could be possible, but that’s just assumptions.
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