The Tezos blockchain will underpin secure, decentralized applications and smart contracts while avoiding some of the political and technological problems which earlier efforts such as Bitcoin and Ethereum have faced. Tezos was built on the belief that a deep commitment to security, formal verification, and governance that gives stakeholders the power to make protocol decisions is the formula for earning trust and generating widespread adoption on the blockchain.
Tezos uses powerful technology uniquely suited to the rigorous, specific requirements necessary to enforce smart contracts on a public ledger. It facilitates making those contracts subject to formal verification, a process used in aerospace, medicine, and other industries that need to ensure that code works as intended – thus obviating the need for later correction – before it is uploaded to the blockchain.
Tezos enables innovation via self-amendment. Every blockchain (Bitcoin, Etherereum, ZCash…), can be described by a triplet (S, apply, score)
S: an internal, mutable, state type. In Bitcoin, this would be the set of unspent outputs
apply: a transform which takes a state S, a transaction T, and produces a new state S’
score: scoring function which determines the valid blockchain branch. In Bitcoin, this would be the total amount of hashing power on the chain.
Tezos augments and improved this model by making apply and score part of the mutable state.
In practice, this means that the rules of the Tezos ledger are self-governing. The rules of the ledger not only control the validity of transactions, but also of the rules’ own evolution.
This simple but incredibly powerful idea enables the following things that make Tezos unique:
Decentralized, automated upgrades: Virtually every example of of modern software provides for automated updates, but blockchains remain a notable exception because update procedures are typically centralized. Tezos achieves decentralized upgrades of its blockchain protocol, something no other system offers.
Upgrades without hard forks: Upgrades are decided by stakeholder consensus in accordance to clearly laid out governance rules that are programmatically enforced. This avoids political deadlock and stagnation without entrusting or empowering a single core development team or de factor group with disproportionate sway over the process.
Funding innovation: While blockchain innovation is moving at a breathtaking pace, there is often little incentive to improve existing systems. As a result, application developers have been shoehorning tokens into applications where they do not naturally fit. These “appcoins” dilute the value of the underlying platform more than they contribute to its network effect.
In contrast, Tezos’ self-amendment capabilities allow protocol developers to be rewarded by the community when their upgrades are included to the platform.