A pivotal milestone is on the horizon for the blockchain world: on May 5, 2025, IOTA will roll out its most significant upgrade to date with the launch of IOTA Rebased, marking its full transition into a decentralized and scalable Layer 1 blockchain. This long-awaited evolution sets the stage for a new generation of Web3 applications, offering unprecedented performance, functionality, and community participation.
The Next Evolution of IOTA: Rebased Protocol
Originally launched in 2015, IOTA has continuously evolved to meet the demands of a fast-changing ecosystem. With the Rebased update, the network undergoes a fundamental transformation. Backed by months of testing, audits, and governance decisions, IOTA is now embracing a Delegated Proof-of-Stake (DPoS) consensus mechanism, finalizing its shift toward full decentralization.
This architectural upgrade not only boosts the network’s integrity but also lays the foundation for expanded use cases in decentralized finance (DeFi), digital identity solutions, on-chain trading, and supply chain tracking.
What’s New in IOTA Rebased?
Unmatched Transaction Speeds and Finality
The integration of the Mysticeti consensus protocol allows the new IOTA network to achieve over 50,000 transactions per second (TPS) with finality in under 500 milliseconds—a performance benchmark that places IOTA among the top-performing blockchains globally.
Smart Contracts Powered by MoveVM
Another major advancement is the deployment of MoveVM, a Move-based virtual machine integrated directly at the base layer. This makes IOTA one of just three networks globally—alongside Sui and Aptos—to offer native Layer 1 smart contracts using the Move programming language, enhancing security, modularity, and developer flexibility for complex dApps.
A Truly Permissionless Validator Ecosystem
The transition to DPoS will begin with 50 initial validators, with the goal of expanding to at least 150, ensuring a more distributed and decentralized validation network. This model significantly enhances transparency, reliability, and participation.
Staking and Token Economics Revamped
For the first time, IOTA token holders will be able to stake $IOTA tokens, earning an estimated annual return of 10% to 15%, thereby encouraging greater community engagement and reinforcing network security.
The new protocol also introduces a fee-burning mechanism and minimal adaptive transaction fees, supported by the IOTA Gas Station—a feature that allows developers and enterprises to sponsor transaction costs for end-users, creating a more seamless experience.
Preparing for the Future with Institutional-Grade Infrastructure
At launch, a cohort of Genesis Validators will help bootstrap the network’s new consensus system. This includes trusted organizations such as the IOTA Foundation, Tangle Ecosystem Association, and validators like Stakin, Luganodes, Twinstake, and Nansen. Simultaneously, the IOTA EVM will be reactivated to ensure full compatibility with Ethereum-based smart contracts.
With its updated architecture, IOTA is strategically positioned to attract institutional investors, governments, and large enterprises, expanding its reach in sectors such as digital trade, tokenization, and trade finance.
Real-World Utility Meets Web3 Innovation
he modular design of IOTA Rebased will enable scalable adoption across industries including smart energy, logistics, and digital identity, without compromising decentralization or efficiency.
Dominik Schiener, co-founder and chairman of the IOTA Foundation, emphasized that “creating real-world value” has always been central to IOTA’s mission—a vision now closer to reality with Rebased.
IOTA’s Bold Leap Into the Future
With a strong foundation in industrial and governmental partnerships and a long-standing commitment to open-source development, IOTA is emerging as one of the most mature and practical Layer 1 solutions in the Web3 space. The Rebased launch isn’t just another upgrade—it’s a transformative leap into the decentralized future, with IOTA ready to lead the next wave of blockchain innovation.