IOTA was created to satisfy the need for interoperability and sharing of resources between every device and utility connected to the internet in the future — more commonly known as Internet-of-Things (IoT) devices. It aims to be the currency for the IoT economy, creating a brand-new network of connected peers for a wholly decentralized system. Imagine your Tesla car paying a charger in IOTAs, and the charger in turn paying the electricity grid in IOTAs, and so on, without any fees, all automatically and in a decentralized fashion.
IOTA is different from other cryptocurrencies in that it’s not based on the blockchain technology — instead, it uses what is called a “Tangle Network”, which allows instant, free, decentralized transactions. It uses Proof-of-work (relative to cumulative weight for all transactions) for transaction approval.
Unlike other cryptocurrencies based on blockchain technology like Bitcoin, Ethereum etc., IOTA is based on the Tangle network and does not need any miners. It's designed to be extremely lightweight, and enable free, instant transactions. It is more scalable than a cryptocurrency based on blockchain is, and is designed for IoT devices which need smaller, more scalable programs for a variety of use cases.
On top of all this, Internet-of-Things is a very large potential market, and if it gets adopted in the mainstream, IOTA would be well-positioned to serve as the currency of the IoT economy.
IOTA is an asynchronous, decentralized and distributed ledger. Every new transaction is built on two previous transactions — so long as a new incoming transaction, verifies two previous transactions, the Tangle network can keep growing making IOTA highly scalable.
IOTA is not binary (zeros and ones) like all other cryptos — instead it is based on a ternary model of computation. This means that three possibilities or states can exist in this network: negative, zero and positive. It gives more power to the network than binary computations can.
IOTA is supported by JINN processors which are “general-purpose-processors” that can conduct thousands of transactions per second. Unlike binary processors, they can go into three states: +, – and zero due to their ternary model.
JINN processors will help IOTA scale in the future and work with newly designed technologies with ease. These processors are not very popular right now, and publicly very little is known about them.
What sets IOTA apart is not just its unique block-less technology but the fact that it does not charge any transaction fee. The amount sent from one user or device will be the amount received by another without any deductions. The transacting nodes will only have to approve two previous unconfirmed transactions. There is no other incentive involved, letting IOTA serve a truly democratic and decentralized function.