In this educational guide, we’re going to explore the altcoin and blockchain named Tezos (XTZ). We’ll cover its fundamentals and planned roadmap, so you can use it to make your own price prediction.
Tezos functions as a multi-purpose and native blockchain of its own. This means the XTZ token runs on its own native blockchain, similar to BTC or ETH. Tezos combines a unique self-amendment protocol and on-chain governance to manage future implementations to its network.
The Tezos blockchain supports both tokens and smart contracts, meaning it can be used for decentralized applications, or dApps as well. Compared to Bitcoin or Ethereum, Tezos is not only faster and more energy-efficient of a blockchain to use, but its on-chain governance system also enables XTZ token holders to make decisions and improve the network over time. The off-chain governance models of other blockchains are less-inclusive, in comparison.
As of the time of writing, XTZ currently ranks in the #46 of top cryptocurrencies by market capitalization. Let’s explore the value, implementations, and price of Tezos’ native XTZ token.
What is Tezos and how does it work?
Tezos was created to be a powerfully scalable, energy-efficient, proof-of-stake native blockchain that was built with mechanisms in place to allow active community governance. It also has the ability to adjust, adapt, and add features and functionality through a unique on-chain upgrade mechanism.
Tezos was launched via an ICO in July of 2017. The Tezos mainnet was launched in Sept. 2018. The launch of the mainnet introduced a new version of a proof-of-stake (DPoS) consensus model referred to as “liquid” proof-of-stake. Instead of using the term staking to describe a user locking up tokens to support the validation of blocks, the Tezos community uses the term “baking.”
In liquid PoS, the Tezos model allows users to delegate their tokens to bakers (validators) without transferring ownership of tokens. In this model, a baker receives a reward in XTZ tokens with a proportional amount of this reward distributed to users that delegated tokens to the baker.
Tezos continues active development and as recently as April 2022, the blockchain added novel capabilities with its upgrade mechanism, with an upgrade called Ithaca 2.
XTZ Tokens
XTZ is the native token of the Tezos blockchain and is used for voting on the network, as well as for transaction fees and smart contract execution fees like with other native blockchain tokens.
XTZ token holders can stake XTZ directly on the network and participate in the securing and validation of blocks. Staking also provides users with proportional voting rights within Tezos, enabling stakers to determine changes to the protocol. XTZ holders who cannot stake directly and instead delegate their tokens can also delegate their voting power to other validators.
Bakers (validators) require a minimum stake of 8,000 XTZ. Participants can also be delegators if they wish to stake without having this minimum stake amount. Participants in the consensus algorithm are called delegates for Tezos and there are two main roles contributors can assume:
- Baker - this party creates blocks
- Endorser - this party verifiers the last block after it is “baked”
Token Distribution
XTZ has no capped, max supply but it has a total supply of 911,257,760 XTZ. It is an inflationary token and the inflation follows a fixed issuance rate.
In the Tezos network, baking (validating) refers to the act of signing and publishing a new block in the blockchain. Every baker earns 16 XTZ per block for participating. In addition, 32 parties called “endorsers” are selected at random to verify the last block after it is baked. Endorsement rewards for this verification are up to 2 XTZ, if the baker with the highest priority made the endorsement. Otherwise, the baker with the second-highest priority making the endorsement receives a reward of 1 XTZ. If neither of the two highest priorities bakers made the endorsement, the reward is set at 0 XTZ.
New coin issuance, or inflation, funds block rewards as well. The Tezos annual inflation rate is programmed to be at a maximum target of 5.51% per year. Since the endorsement rewards structure and the block generation time is variable, the real inflation rate can be lower than the maximum 5.51%.
XTZ tokens can also be burned in two instances—when a baker is caught acting maliciously such as double baking or double endorsing, and when a new account for a delegation is created via smart contract.
As of the time of writing, there are 889.6M XTZ tokens in the circulating supply. When the ICO was launched for Tezos in July 2017, its initial supply was 763.3M XTZ tokens and XTZ tokens in the ICO were sold for a cost basis of $0.47 per XTZ.
This initial 763M XTZ token supply was allocated as follows:
- 79.59% was allocated to ICO participants
- 0.41% was allocated to early backers and contractors
- 10% was allocated to the Tezos Foundation
- 10% was allocated to Dynamic Ledger Solutions (DLS)
- The XTZ tokens that were allocated to the Tezos Foundation and to DLS were subject to a 4-year vest schedule, with monthly cliffs.
Source: Messari.io
Tezos (XTZ) Price History & Technical Analysis
As of the time of writing, in April 2022, the price of XTZ is at $3.96, with a market capitalization of $3.2 billion USD.
The total value of Tezos’ network is meant to grow with more demand for and usage of the network bandwidth, which grows with more network activity and users.
XTZ is not a capped supply token and is inflationary at an average real inflation rate of approximately 5%, so supply and demand dynamics may not be as strong as they would be for a fixed supply token. While address growth alone does not necessarily translate to the growth of users, it is still a way to gauge growth. Metcalfe’s Law states that the value of a network is directly related to the number of users of that network.
What Expert Analysts say about Tezos:
- CRYPTOPOLITAN says, "Tezos is drawing the attention of people because it operates the Delegated Proof of Stake (DPoS). For several reasons, this is an edge the platform has over others like Ethereum. While some other platforms may be thinking of switching from PoW to PoS, Tezos already adopted it from the onset. In 2025, the average Tezos price is predicted to have improved drastically in its worth such that it would record an 825% increase on the present price—this XTZ price prediction forecast it to reach 24.06 USD by that time.”
- Coinpedia says, "XTZ continued to spike. By the year 2023, exponential growth is highly anticipated due to inbound development and adoption. In the best possible case, XTZ may exchange for $14.86 by the end of 2023. The price may drop well below $7.998 if the bears rule the market. With average buy and sell pressures the asset is anticipated to trade at $10.75.
As we can see that Tezos is a self-evolving platform, we may more likely expect the platform to survive the frequent dips. With the adoption of Dapps and further developments, Tezos’ price might reach a maximum of $25. Average and minimum possibilities are being $21.65 and $17.65.” - DigitalCoinPrice notes, “As per the revised prediction of wallet investors, XTZ price is forecasted to hit a maximum price of $7.132, minimum it would flip to $4.666. The token is expected to trade at an average price of $5.909 by 2022. Walletinvestor anticipates the token to trade at an average price of $11.737. The maximum price expected is $15.769, minimum it would plunge back to $7.916 by 2025.”
Tezos Partnerships
Tezos has forged several notable partnerships and the Tezos ecosystem today is home to many builders committed to building on the energy-efficient and upgradable Tezos protocol.
As far as its direct ecosystem, Tezos has four block and smart contract explorers, 17 DeFi services, as well as tools for digital identity, gaming, and a growing NFT community.
Many notable companies are also working on Tezos or even run a Tezos node of their own. Some examples of such companies include Red Bull Racing, Ubisoft, Groupe Casino, Societe Generale, EDF official, and others. Red Bull has labeled Tezos its official blockchain partner, and Societe General seeks to explore the feasibility of financial securities being digitally settled and delivered in CBDC.
Tezos was branded the official blockchain of Manchester United and has partnerships with gaming developer Ubisoft to create Ubisoft Quartz, which is a game that leverages Tezos’ unique consensus mechanism for its energy efficiency.
Another notable corporate partner is Exaion, a subsidiary of the French multinational electric utility company EDF Group, which joins the Tezos ecosystem as a corporate baker (validator). The company intends to use the Tezos ledger to develop solutions to minimize the carbon footprint of its business.
Prominent investors in Tezos include Meltom Demirors, Chief Strategy Officer at CoinShares, and VC firms invested in Tezos include Paradigm, Blocktree Capital, Polychain Capital, Winklevoss Capital Management, and others.
Tezos Price Prediction: 2022-2026
XTZ’s price remained under $2 from initial launch until breaking out in 2020. From 2020 onwards, Tezos has been forming a macro wedging structure with more expanded upswings, and deeper downswings, but the trend on the weekly chart above shows higher highs and lower lows every year. As such, we can expect Tezos to continue to follow such a pattern until this pattern itself ceases.
Tezos’ last peak in price was in October 2021, during which it staged an extremely strong recovery overtaking its previous peak of May 2021, to the surprise of many crypto investors. Even during much of the bearish price pressure for the first part of 2022, Tezos has still held its lows from summer 2021 and respected the rising trendline seen in the chart above.
As long as the XTZ token remains above this rising trendline, it is likely that the price will not see below $2.50 now and may even go on to make a new higher high as per the trend during 2022 itself. With more expanding partnerships and continuing updates to Tezos’ strong roadmap, investors can expect the previous all-time high of $9.5 breached likely far before 2026. However, if this rising trendline is lost or a greater economic contraction occurs that leads to overall losses in the cryptocurrency markets, then Tezos may not see its all time high for a longer time.
Tezos Price Prediction 2022
With the price continuing to hold well above summer 2021’s lows of $2, and Tezos’ continued strong partnerships and developing roadmap, its growth continues to look promising. This makes analysts predict that Tezos will see above its previous all-time high of $9.4 potentially during 2022, which is dependent on whenever the crypto market resumes its bullish price action. Keep in mind this could also take longer, depending on the overall crypto market cycle and other strong catalysts in store for Tezos.
Tezos Price Prediction 2023
With the growing necessity for upgradable smart contract platforms and for use cases such as NFTs that Tezos solves, we expect to see continued growth of the Tezos ecosystem. As of 2022, there are 23 NFT platforms built on the Tezos blockchain, amongst 5 stablecoins, 4 digital identity solutions, and 17 DeFi tools. As liquidity and usage of these wide range of tools expands, Tezos continues to be a strong contender into the future.
This could make Tezos see above $10 by 2023.
Tezos Price Prediction 2024
The Tezos roadmap and history provides us a glimpse of planned improvements to the protocol, and the growing market capitalization looks promising. The market capitalization alone remains at only $3.2 billion in April 2022, and a conservative 4-5x to reach $12.8-$16 by 2024 would put the XTZ price at $15 or higher by 2024.
It’s not unreasonable to see Tezos hit these prices by 2024 with continued development and expansion of its core protocol as well as partnerships and ecosystem. Of course, this is also provided the overall crypto market remains bullish and we can avoid an economic downturn and bear market overall.
Tezos Price Prediction 2025
2025 is still far away at the time of this writing. The continued usage trends and developmental challenges in blockchain are uncertain to extrapolate that far out, however Tezos has been backed by prominent backers and has remained a strong choice since its launch to this day.
Plus, the need for energy-efficient, easily upgradeable, and fast blockchain platforms that can serve the growing needs of dApps and NFTs will only continue to increase with greater adoption. We predict we will see Tezos at $20 or above by 2025.
Tezos Price Prediction 2026
The crypto market overall could very well be worth $10T or even as high as $15T in total market capitalization by 2026. Depending on regulations and the overall economic cycles of the economy, we may see Tezos as high as $25-30 by 2026.
None of these predictions are financial advice, and are educated guesses as to where Tezos’ price may be at each time interval. It should be noted that any major financial hack, cease in development, or other black swan events could impact these predictions significantly.
Tezos (XTZ): Conclusion Price Prediction
Tezos is a top blockchain investment choice for anyone based on its strong partnerships and wide range of active development alone. When considering its unique technology that offers benefits over other major blockchains, as well as its growing usage across its ecosystem, it’s clear why XTZ is a great choice for anyone to retain in his or her wallet for the long haul and not worry about day-to-day price fluctuations.
Some may be hesitant to commit their money into an asset for an extended period of time due to the extreme volatility and risk of the cryptocurrency markets. However, it’s great to see top companies such as Societe Generale and Ubisoft, among others, working and partnering with Tezos.
FAQs
How is Tezos gaining traction?
Tezos is gaining traction thanks to the wide range of dApps being developed and built on top of its scalable native blockchain platform. These projects and protocols can be noted here. As their usage and liquidity increases, it means more usage of the native Tezos blockchain itself and thereby greater value of the XTZ token with time.
Many investors are also interested in Tezos’ price and potential because of its unique technological advantages in scalability, protocol changes, and governance over other blockchains. Because the overall market believes in the technology Tezos offers, the price continues to hold and increase over the long term thus far.
Where can I buy Tezos?
XTZ, the token, can be bought and traded on all major centralized platforms and exchanges such as Binance, Coinbase, KuCoin, and Voyager, and others for all major fiat currencies such as USD, GBP, and EUR, or even for crypto pairs such as trading BTC or ETH for XTZ.
In comparison to other cryptocurrencies, how can Tezos secure privacy?
While XTZ is a public blockchain platform, it does use a technology known as zero-knowledge proofs for anonymity, which allows users to interact with smart contracts in a way that only they know what information they store on the blockchain. This way, some applications on Tezos have the option of using an open ledger which makes public all transactions, or to optionally not store data publicly on-chain for more privacy. Note that since XTZ is otherwise a public blockchain, all transaction data is publicly available on the network for any party to see. Plus, using advanced blockchain forensics in the modern day, it can be possible to track users in the case of illicit activity.
Is it possible to stake Tezos?
Yes, XTZ tokens can be staked (or “baked” as it is referred to on the XTZ blockchain itself) with bakers (validators) which requires a minimum stake deposit of 8,000 XTZ. Users with under this amount can also delegate their XTZ tokens to earn rewards and help secure the network without the hassle of running their own node.
Why is Tezos on the rise?
XTZ tokens are on the rise because of the usage of its dApps on the network, the rise in active NFT platforms on Tezos, and the unique technological advantages Tezos offers to the greater blockchain ecosystem and markets with its benefits for governance, upgradable infrastructure, and fast throughput.
Is Tezos completely anonymous?
No, all public ledgers are visible for all transaction data to all parties on the blockchain. Tezos is a public blockchain, so any party can see all transactions on public Tezos blockchain explorers such as tezblock. However, transaction data may be pseudonymous, meaning the user’s name is not necessarily linked to the transactions or wallet addresses. However, depending on where the user sources their fiat or XTZ tokens, blockchain forensics can easily identify the user’s identity.
Is XTZ considered a currency?
Yes, XTZ tokens are a currency that are used for the payment of transaction fees and smart contract execution fees on the Tezos blockchain, among other uses such as voting.
Is it possible to generate profits with Tezos?
Yes, assuming the XTZ token increases in price over time with the continued development of the Tezos blockchain and its associated ecosystem, it is possible to generate profits by investing in Tezos, but not guaranteed due to other factors that can affect the investment and the overall cryptocurrency markets.
All investors must do their own research, due diligence, and ensure that they are comfortable with the amount of risk they are taking. All cryptocurrencies are extremely volatile and risky. Always proceed with caution.
Why do people believe in Tezos?
Many analysts and venture capitalist investors believe that Tezos is one of the most advanced and sound developing blockchain networks out there today, especially with the prolific increase in NFT platforms and DeFi on the Tezos blockchain as of late.
Is Tezos supply limited?
No, the XTZ supply is uncapped and not limited. It is an inflationary token, but inflation is programmed to be at an average inflation rate of approximately 5%. This may make the supply and demand dynamics of the XTZ token slightly different than a fixed or capped supply token that may even be deflationary by default, but it does not mean that XTZ is a bad investment or will not increase in value over time with usage and growth of the network.
How does the Tezos team investigate suspicious or fraudulent transactions?
It is not clear how the Tezos team controls the investigation of fraudulent transactions yet.
Since the Tezos network requires transaction fees to use, this is inherently a deterrent for potential scammers and attackers that may otherwise try to overwhelm the network. Thanks to the Tezos public blockchain explorers, all participants and associated blockchain forensics systems also have a real-time view of transactions used for predictive analysis and detection of fraudulent activities.
DISCLAIMER
This is not financial advice, only observations and speculation. All investors should do their own research and due diligence. The crypto markets are extremely volatile and losing your investment is possible.
