A brief history
Tezos was conceived by Arthur Breitman, a France native and former engineer at Google X and Waymo. In 2014 Breitman published the whitepaper outlining Tezos, and the ICO of the platform occurred in 2017. Tezos is a blockchain designed to run smart contracts and decentralized applications (DApps). It's unique from other protocols in that it can update its features without the need for a hard fork. To avoid any type of forking, Tezos has an on-chain governance model that allows the blockchain to implement changes automatically. In order to do this, the Tezos blockchain is divided into two parts: the Shell, and the Protocol. The Shell is the code that amends itself based on user voting, it is also responsible for interpreting transactions and administrative operations. The Protocol is the code responsible for sending proposals to the shell for review. To keep its network in sync, Tezos uses a variation on the classic proof-of-stake (PoS) consensus called liquid proof-of-stake (LPoS). For nodes to participate in governance, they need to stake XTZ in a process Tezos calls “baking.” To become a baker, a node needs to hold 8,000 XTZ. The voting process consists of four distinct voting periods separated by roughly 23 days.

XTZ in practice
The XTZ cryptocurrency plays a key role in maintaining and operating the Tezos network and can be used for holding, spending, or baking. As mentioned before a minimum of 8,000 XTZ is required to become a baker on the network. Bakers can both vote and stake on the platform, but the more XTZ a baker holds the better their chances of being selected to bake. For users who don’t have the minimum 8,000 XTZ, they can delegate their XTZ to a user who does. The bakers then re-distribute the rewards they receive for baking blocks back to delegators.