IOTA Chrysalis phase 2: Release until end of the year, colored coins postponed

  • Jakub Cech informed about the current progress for Chrysalis phase 2, which will receive a test net in November at the earliest.
  • Colored coins were removed from the release of phase 2. The functionality will be released with a later update.

In a new status update Jakub Cech has informed the community about the progress of IOTA Chrysalis phase 2. As Cech stated, Phase 1 was implemented on the IOTA mainnet a few weeks ago. This and brought a strong performance improvement with fast confirmation times and at the same time a higher transaction throughput of over 1,000 TPS.


The developments for phase 2 are currently in full swing, with various components apparently still requiring some work. The first tests of the Chrysalis node software should start in October or November. Depending on how successful this pilot phase is, Chrysalis phase 2 could be released this year. As Cech states, the upgrade will be the largest “network upgrade in the history of IOTA, affecting every part of the IOTA ecosystem”.

Chrysalis phase 2 includes numerous components such as support for the Ed25519 signature scheme to enable address reuse. Furthermore, the UTXO (Unspent transaction output) is to be improved in order to further increase performance.

The binary transaction layout and validation is to be improved so that no binary-trinary conversions are required, as in the current node software. In addition, atomic transactions will be introduced, making the transition from the current bundle construct. Currently, the IOTA development team is working on the following changes:

  • A new design of the message object, i.e. the object with which nodes in the network interact and which contains various payloads
  • Optimization for signed transaction payload, milestone payload and indexing payload
  • Changes to the proof of work for mapping different message sizes
  • An extensible address format for different types of signature schemes based on bech32
  • A completely new node API
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Many of the current client libraries will receive numerous changes for the second phase of Chrysalis. All bindings for the core library will be provided in Rust, but some will remain native to the C or Go programming language. The libraries will also be delivered with a new API, which makes the integration and maintenance of new solutions based on IOTA much easier for customers than before.

Furthermore, the new client libraries will replace the previous solution “Hub”, a wallet management solution for exchanges and custody providers. The wallet team is also working hard to develop the new wallet, which will use Stronghold as its base and replace Trinity. Before Chrysalis phase 2 is released, there will be a testnet, the release date of which will be announced.

One of the important parts of Chrysalis phase 2 will be having a testnet with the initial changes live prior to the release. This will allow us to test all the Chrysalis phase 2 changes, wallet, and products, in addition to testing changes to existing integrations live. The testnet will expose public endpoints for anyone to test the new APIs and integrations.

Colored coins will not be released with Chrysalis phase 2

The functionality of the colored coins, now called the “Digital Asset Functionality”, will not be introduced immediately with Chrysalis phase 2, according to Cech. Other functionalities, such as reusable addresses, the layout of binary transactions, the introduction of a much better developer and wallet experience and the general integration of UTXO will have priority for the time being. The report leads to the postponement of the release of colored coins:

Digital assets will be added to the protocol in a subsequent, separate update instead. This will allow us to design, develop, and release the digital assets functionality in a way that allows us to support all the use cases we are envisioning for the tokenized economy. This will allow us to release Chrysalis phase 2 without being delayed by digital asset capability development.

About Author

Collin is a Bitcoin investor of the early hour and a long-time trader in the crypto and forex market. He's fascinated by the complex possibilities of blockchain technology and tries to make matter accessible to everyone. His reports focus on developments about the technology for different cryptocurrencies.

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