Connect with us

Buyer's Guide

How to Buy Tezos (XTZ)

mm

Updated

 on

Securities.io is committed to rigorous editorial standards. We may receive compensation when you click on links to products we review. Please view our affiliate disclosure. Trading involves risk which may result in the loss of capital.

Tezos (XTZ) is a fourth-generation blockchain network that incorporates advanced protocols to enable a host of functionalities. Primarily, the platform supports the development of decentralized applications (DApps) and the coding of smart contracts. To learn more visit our Investing in Tezos guide.

We list the top 3 brokers that offer the ability to buy Tezos (XTZ) with a credit card or debit card.

Binance

Binance is one of the largest and most well-known cryptocurrency exchanges in the world. The benefits of purchasing Tezos (XTZ) here is that you benefit from the lower exchange fees than competing exchanges, and the increased liquidity enables you to buy and sell quickly to take advantage of market moving news.

Read our Binance Review or visit Binance.

Use Discount Code: EE59L0QP for 10% cashback off all trading fees.

Kraken

Kraken is one of the longstanding names when it comes to cryptocurrency exchanges operating in the industry.

From humble beginnings, they have now gone on to become one of the most recognizable names in the space offering an extensive selection of assets to trade including Tezos (XTZ).

The trading costs are competitive with other exchanges and they have continued to evolve now offering both futures and margin trading.

Read our Kraken Review or visit Kraken.

Poloniex

Poloniex was founded in the US in 2014 and has quickly risen to become a very popular exchange of choice for many crypto traders looking to combine a strong range of assets, with great value. They are continuing to expand their asset range all the time, with more than 100 different pairs choices including Tezos (XTZ) now available to trade. With a recently revamped look, the exchange is also looking more professional than ever with trading in futures and on leverage of up to 100:1 also now available to access.

Read our Poloniex Review or visit Poloniex.

Best for

Advanced Traders

Best for

USA Traders

Best for

Ease of Use

Trading Fees

0.10%

Trading Fees

0.16%

Trading Fees

0.125%

Promotions

10% Cashback

Discount Code: EE59L0QP

Promotions

None

Promotions

None

What are Tezos (XTZ)?

Tezos is an open-source, blockchain based platform.  It is decentralized in nature, and makes use of its native ‘XTZ’ tokens to support various features.

What does it do?

Features supported by Tezos are numerous.  The following are the most commonly noted of these capabilities.

  • Facilitating two party value transactions eliminates need for ‘middlemen’ parties
  • Smart contract capable (self-executing contracts, based on built-in parameters)
  • Self-amending
  • On-chain governance supporting growth and eliminating forks

How does it Work?

Tezos takes a somewhat unique approach towards how they achieve functionality.  Through a coding language known as ‘Michelson’, the network is able to function under a proof-of-stake (PoS) model.

Where Tezos differs from many, is its approach towards network governance.  In an effort to ensure forward progress, and incentivized network participation, Tezos makes use of what it calls ‘bakers’.

Bakers are similar to the commonly used ‘miners’ on proof-of-work networks – with a few key differences.  While both are essential for their networks, bakers operate through delegated-proof-of-stake to verify transaction, and thereby secure the network.

The role of baker goes beyond transaction verification, however – this group is responsible for casting protocol changes based on the desire of the token holders which have delegated their network power to said baker.

A factor which maintains network decentralization, is the ability for anyone to act as a baker.  All that is required is a ‘roll’ of XTZ (each roll consists of 8000XTZ).  As anyone can become a baker, and contribute to network growth, Tezos is typically viewed as a more democratic project than many others.

Projected Developments?

With crypto markets experiencing a resurgence, Tezos is, once again, gaining in popularity.  This trend is expected to continue, as there are various important developments underway.  With assets held by the Tezos foundation having grown to roughly $630M at the time of writing, network development should not be hindered by finances.

Primary among expected network developments is privacy.  While there are various ways to achieve greater levels of privacy, Tezos developers have made the decision to utilize what are known as ‘zkChannels’.

zkChannels are an intriguing upgrade, as it will not only facilitate privacy transactions, but open the possibility to bridge the Tezos blockchain with others utilizing its codebase.  One example of which is the popular ‘zCash’.

Underlying Ideology?

Tezos is built on a solid foundation of ideologies – more than most.  When the idea of the network was first taking shape among its founders, its growth was shaped on recognizing the deficiencies of Bitcoin and Ethereum, and improving on them.

While Bitcoin was founded with the idea of financial inclusion, and decentralization, it did not seamlessly pull off this feat.  Due to the structuring and governance utilized by Bitcoin, the network was subject to inefficiencies, and being forked any time a forward path was not agreed upon among its community – an issue which continues to plague Bitcoin to this day, with many forks continuing to be created.

By utilizing a more democratic method of governance (DPoS), Tezos is able to avoid being bogged down by indecision, and avoid potential forks.

Its structuring also means that the network should be able to attain a higher level of decentralization, and transparency; Each, traits which underpin the ideologies that Bitcoin and Ethereum are based upon.

Acceptance and Controversies?

With steady growth being seen within the world of blockchain, Tezos has done well with regards to adoption.  In the past few months, Tezos has seen an increase in interest, specifically among companies involved with digital securities.  The following are just a few examples of this recent adoption.

While adoption has seen an uptick, Tezos is no stranger to controversy.  Until recently, contention surrounding its $232M ICO held in 2017 surrounded the project.

Some of the aforementioned points of contention are as follows.

Uncapped ICO – Many felt that this uncapped ICO was unnecessary, and took advantage of an immature sector in the midst of an unsustainable boom.

Fund misuse – Almost immediately upon raising funds, there were disagreements among the Tezos team on how it should be used. This, among other reasons, led to a delay in post-ICO token distribution

Civil lawsuits – For multiple years, Tezos was battling a civil lawsuit in which investors in the ICO alleged that the event represented the illegal sale and distribution of securities. After battling for multiple years, this lawsuit recently came to a conclusion, as Tezos agreed to a $25M settlement, with no admittance of wrongdoing.

Thankfully for Tezos, these early troublesome days appear to be a thing of the past.

Regulation?

Despite the controversies and civil lawsuits which have plagued Tezos in the past, no official statement has been made by regulators, to date, on the status of XTZ as a security.

The Crypto Ratings Council (CRC), built to assess the nature of tokens/coins and their likely asset class, has noted that XTZ does, indeed, share some traits with a security.  In their rankings, a 1 represents an asset not sharing any traits with securities, while 5 demonstrates all of the required traits.  In its assessment, the CRC ranks Tezos with a score of 3.75/5.  This score places it alongside other blockchain projects such as Stellar, Polymath, and Loom.

It is important to note that the CRC is an independent council, with no actual power to classify an asset.  This task resides with the Securities and Exchange Commission (SEC).  The CRC simply provides a service providing an educated guess on asset classification, based on traditional assessment tools.

Who Made It?

While development of Tezos is the work of many, the project is largely credited to its two cofounders.

  • Arthur Breitman
  • Kathleen Breitman

This blockchain ‘power couple’ have been enveloped in the technology dating back to the early days of Bitcoin.

Spread the love

Daniel is a big proponent of how blockchain will eventually disrupt big finance. He breathes technology and lives to try new gadgets.

Advertiser Disclosure: Securities.io is committed to rigorous editorial standards to provide our readers with accurate reviews and ratings. We may receive compensation when you click on links to products we reviewed.

ESMA: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Investment advice disclaimer: The information contained on this website is provided for educational purposes, and does not constitute investment advice.

Trading Risk Disclaimer: There is a very high degree of risk involved in trading securities. Trading in any type of financial product including forex, CFDs, stocks, and cryptocurrencies.

This risk is higher with Cryptocurrencies due to markets being decentralized and non-regulated. You should be aware that you may lose a significant portion of your portfolio.

Securities.io is not a registered broker, analyst, or investment advisor.