IOTA Moves to Rebased Protocol in Two Weeks, Its ‘Most Technical’ Upgrade Yet

Layer-1 blockchain Iota has announced that its upgrade to the much-anticipated Rebased Protocol is ready for Monday, 5 May 2025. It will officially migrate from the Stardust network to the novel IOTA network.

According to the team, IOTA Rebased will be the chain’s “largest, most complex, and most important upgrade to date.”

The announcement has highlighted several essential protocol features that will be available immediately upon launch.

These include​ the Mysticeti consensus protocol, which will enable the chain to reach high scalability and faster transactions. IOTA Rebased will see throughput over 50,000 transactions per second and transaction finality under 500 ms.

Moreover, IOTA has integrated smart contracts based on the Move programming language directly onto the L1. This allows developers to build “sophisticated,” scalable, and secure decentralized applications (dapps). The team notes that IOTA is only the third network offering the MoveVM after Sui and Aptos.

Next, Rebased brings minimal transaction fees with an adaptive fee-burning mechanism. At the same time, it comes with the new IOTA Gas Station that enables developers and businesses to cover their users’ fees. This means that users can execute transactions without having IOTA coins themselves.

Finally, the Layer-1 network will upgrade to a fully decentralized delegated Proof-of-Stake network (DPoS). It will begin with 50 permissionless validator slots and gradually increase to over 150.

Initial IOTA Rebased Genesis Validators include IOTA Foundation, IOTA Ecosystem DLT Foundation, Tangle Ecosystem Association, DLT Green, P2P, Luganodes, Twinstake, KILN, Stakin, Nansen, Blockscope, DAIC/Coinage, and Staketab.

Meanwhile, the upgrade follows a governance vote, technical testing, review, and audit process, the announcement says.

As reported, in the December governance vote, the IOTA community supported the Rebased protocol upgrade proposal. The IOTA Foundation explained that the blockchain would switch from L1 to a Move-based object ledger. The token holders voted in favor.

Iota Introduces Staking Rewards for the First Time

In addition to the many technical enhancements, the Rebased upgrade will also introduce staking rewards. This should give the IOTA tokens utility.

Per the team, this will mark the first IOTA staking rewards in the project’s history.

Moreover, the new system will allow IOTA token holders to actively participate in securing the network and will incentivize them to do so.

At the same time, they will earn rewards for their effort. The upgrade will offer an annual percentage yield (APY) of up to 10%–15%.

The announcement states that “IOTA’s official migration to the new IOTA Rebased protocol marks a pivotal advancement in IOTA’s history as it readies itself to bring significant new adoption and applications to the ecosystem.”

It will help the project onboard institutional investors – “even countries” – to its tokenization, trade digitization, trade finance, and digital identity platforms.

Finally, IOTA aims to introduce advanced applications to its Web3 ecosystem. These include, among others, DeFi, on-chain orderbook exchanges, supply chain systems, and stablecoins.

Meanwhile, IOTA trades at $0.1727. It is up 1% in a day and 6% in a week. Also, it is down 6% in a month and 29% in a year.

The coin hit its all-time high of $5.25 in December 2017, decreasing by 96.7% since.

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