The rise and success of Bitcoin during the last six years proved that blockchain technology has real-world value. However, this technology also has a number of drawbacks that prevent it from being used as a generic platform for cryptocurrencies across the globe. One notable drawback is the concept of a transaction fee for transactions of any value. The importance of micropayments will increase in the rapidly developing IoT industry, and paying a fee that is larger than the amount of value being transferred is not logical. Furthermore, it is not easy to get rid of fees in the blockchain infrastructure since they serve as an incentive for the creators of blocks.
In this paper we discuss an innovative approach that does not incorporate blockchain technology. This approach is currently being implemented as a cryptocurrency called iota, which was designed specifically for the IoT industry. The purpose of this paper is to focus on general features of the tangle, and to discuss problems that arise when one attempts to get rid of the blockchain and maintain a distributed ledger.