IOTA to Conduct Biggest Mainnet Upgrade with Rebased Protocol in May 2025

Key Takeaways:

IOTA will conduct its biggest-ever mainnet upgrade on May 5, 2025, shifting to the new Rebased Protocol.The upgrade introduces permissionless, delegated proof-of-stake (DPoS) validators and natively built-in staking features.Network throughput is expected to surpass 50,000 transactions per second (TPS).MoveVM-based smart contracts will go live with the upgrade, introducing IOTA’s DeFi and Web3 features.The upgrade is IOTA’s path to a full-fledged decentralized Layer 1 blockchain network.

A Core Network Milestone for IOTA

On April 22, 2025, IOTA officially announced its most significant network upgrade to date. The project core team confirmed that its mainnet would make the switch over to the Rebased Protocol on May 5, 2025. The upgrade represents a structural revolution, taking IOTA from its original centralized validation methodology all the way to a full-fledged decentralized, high-performance blockchain platform.

The Rebased Protocol is designed to address some of the IOTA’s early design limitations, namely the central Coordinator node dependence, by deploying decentralized consensus through permissionless validator nodes.

Delegated Proof-of-Stake Validators Deployment

One of the standout features of the Rebased upgrade is the deployment of a delegated proof-of-stake (DPoS) system. Under the new setup, transaction validation will be conducted by an initial set of 50 permissionless validators, ramping up to 150 with increased adoption.

Anyone who has the necessary staking assets and technical capabilities will be able to become a validator, locking up the network and voting on-chain. This is a historic move towards democratizing on-chain transaction validation, bringing IOTA’s consensus layer genuinely distributed for the very first time.

Increased Scalability: 50,000 TPS and Beyond

The IOTA Foundation has ensured that after the deployment of Rebased Protocol, the network processing power will exceed 50,000 transactions per second (TPS). This aspect puts IOTA at par with high-speed Layer 1 chains like Solana, Aptos, and Sui.

Excellent transaction throughput is particularly important in use cases involving real-time data exchange, IoT micropayments, and decentralized finance (DeFi), where transaction speed and network efficiency are paramount.

Native Staking Mechanism for Token Holders

A critical part of the upgrade is adding a native staking mechanism. Token holders in IOTA can stake their tokens with validators and earn staking rewards, validating the network and decentralizing it.

The staking program would benefit long-term holders of IOTA who would prefer new avenues for passive income. It also increases network governance access to the community, strengthening community control of protocol upgrades and operation decisions.

Smart Contracts Launch with MoveVM

The May update will also witness smart contracts enabled by MoveVM, a virtual machine based on the Move language originally developed by Meta’s Diem project. MoveVM has since been adopted by blockchains like Aptos and Sui, and its arrival in IOTA opens new use cases in DeFi, NFT marketplaces, gaming, and tokenized asset systems.

Upon the integration of programmability into the mainnet, developers will have the ability to deploy financial protocols and decentralized applications (dApps) directly onto IOTA’s feeless, high-speed network.

Mainnet Migration and Validator Onboarding

Prior to the upgrade, IOTA will initiate a mainnet migration phase leading up to May 5. Token holders will be able to stake IOTA tokens via official wallets, while validator candidates can enroll and configure their infrastructure.

The Foundation will release a comprehensive validator onboarding guide, public staking tutorials, and a network health monitor. These tools are intended to offer a seamless and inclusive transition to the upgraded mainnet.

Community and Developer Adoption

DeFi developers and platforms have expressed interest in building on IOTA when MoveVM is launched. The network’s nearly feeless transactions and high TPS are particularly attractive to DeFi protocols, gaming platforms, and high-frequency transaction systems.

Strategic Positioning in the Blockchain Ecosystem

Rebased Mainnet Upgrade is a central part of IOTA’s long-term strategy to evolve from its early IoT transaction network to a general Layer 1 infrastructure. Near-future planned milestones involve scaling validator capacity to more than 150, enabling multi-asset token standards, and adding cross-chain interoperability solutions, positioning IOTA to provide enterprise as well as Web3-native applications.

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