A project by block.one, EOS blockchain based infrastructure help commercially scale decentralized applications by providing all the necessary tools for developers. The software handles all complications such as databases, authentications, scheduling, accounts with permissions etc. It uses Ethereum’s blockchain network.
With all the complications regarding the development process on one side, it allows developers to fully devote their time to their business logic. The EOS software allows developers to build blockchain applications with ease. These applications will be similar to existing web-based applications which is the cool thing about it. The software takes care of most of the work for you.
Two unique features about EOS makes it an interesting prospect
- One of them is the elimination of a transaction fee. The idea is that users don’t need to use EOS coins in order to use the software but they need to prove that they hold them. So according to the number of EOS tokens you own, you are entitled to use the platform’s resources for your development purposes.
- Another key feature is the scalability feature. According to the people behind EOS, millions of transactions can be processed at the same time with parallel processing and asynchronous communication. One of many blockchain cryptocurrencies weaknesses (such as Ethereum) is the high transaction cost. Thus with no transaction cost, EOS stands out to the wider market.
The EOS operating system will be hosted on servers that will also act as block producers. These blocks (block rewards) are the incentives for which these servers will host EOS applications. All applications running on the server will be able to connect to each other and there will also be a way to secure these applications by the use of firewalls. Applications will also have their own secure database and file space on EOS.
Thus, EOS will help developers create blockchain applications which will be user-friendly for the end user. This user-friendliness is an advantage over Ethereum as it did not offer a user-friendly way of interacting with their blockchain.
Another impressive feature of EOS is the ability to roll out bug fixes and updates through supermajority consensus. This is done through the mechanism mentioned earlier in which you just need to hold EOS coins rather than use them. Multiple witness nodes are chosen as representatives to make higher level decisions quickly without having to make a poll for the entire network.
This is possible because the EOS coins you hold are not there for use but kind of like shares determine how much ownership or stake you have in the entire system. This can help large enterprises adopt and interact with blockchain technology perhaps.
Challenges EOS faces
Ethereum has the advantage over EOS with regards to smart contracts. There are many systems that have already been built on Ethereum and it has also been proven to be a commercial grade blockchain. EOS, on the other hand, is relatively new so it will face some difficulty in getting eyes towards itself. It is generally harder for the newer version to gain support initially especially if there’s already a well-established competitor already existing in the market.
However, EOS has a faster and cost less system which will likely grab the attention of many. Thus, given time, EOS could become the leading platform for developing blockchain-based applications.
Another issue was the ICO. There was no cap on the amount of money that went into EOS. This meant that there was no limit to the amount of funding EOS could receive. We don’t know if they received too much money if they did then how do they intend to use it? This might even lead to hyper valuation. This is something the folk at EOS need to look into.
How the EOS distribution works
The EOS coin distribution started on June 26, 2017. It’s a 341-day distribution. The longtime frame was chosen in order to give people time to learn about EOS before investing in it because as the people at EOS themselves put it “The EOS Tokens are not designed for investment or speculative purposes and should not be considered as a type of investment.”
The distribution was divided into periods. A total of 1 billion EOS coins would be distributed, with 100 million reserved for block.one themselves. 200 million were distributed out in the first 5 days of the distribution. The remaining 700 million have been split into 350 consecutive periods of 23 hours each.
At the end of each period, the number of EOS coin will be distributed pro rata amongst the purchasers. It depends on the amount of Ethereum each person contributed, they will act as weights and each person gets relative to the weights they contributed. Here’s an example on their website’s FAQ:
“20 EOS Tokens are available during a period.
Bob contributes 4 ETH and Alice contributes 1 ETH during the period. The period ends.
As a total of 5 ETH were contributed for 20 EOS Tokens during the period, 1 EOS Token will be distributed for every 0.25 ETH contributed. Therefore, Bob receives 16 EOS Tokens and Alice receives 4 EOS Tokens.”
There’s no set price for EOS coins, it depends all on the demand. There is, however, a minimum purchase for EOS coins. during any distribution period, the minimum contribution is at least 0.01 ETH. all contributions below that will be rejected. If you’re interested in buying EOS coins then you’ll need an Ethereum Wallet. Here are the Ethereum Wallets supported currently:
The EOS project was created by Dan Larrimer. He’s the same person behind BitShares (a decentralized asset exchange) and Steemit (a blockchain-based social media platform), both very successful projects in their own right. EOS definitely has the right man for the job.
Another influential name when it comes to blockchain is Ian Grigg who serves as an advisor for EOS. He’s a renounced financial cryptographer with over 20 years of work under his belt. He’s the man who invented the Ricardian contract and co-invented Triple Entry Accounting. Although Dan has a reputation for “moving on” just like he did with BitShares and Steemit, that’s not necessarily a bad thing since he made them stand on their own two feet before seeking pastures anew.
Thus, there’s no doubt on the team behind EOS. it’s a very capable team with lots of credibility and experience in the blockchain industry. It’s relatively new so there’s that risk of investing in something that’s still in its baby stages but as crypto-experts believe in early investments, you can get your hands on EOS coins through Binance.
However, as with almost everything new, this project has a lot of potential as the world’s first decentralized operating system so it could also give substantial returns. It’d be wise not to go all-in on the project but investing a little is always good as it diversifies your portfolio.