EOS is a cryptocurrency token for a smart contract and distributed application blockchain system designed to compete with Ethereum.
EOS aims to provide a distributed virtual cloud computer known as EOSIO.
Current EOS Price: $5.47
Total Market Cap: $4.9bn
(Data as at 21 October 2018)
Top Ten Cryptocurrencies – EOS
Like Ethereum, EOS is a smart contract platform and decentralized operating system intended for the deployment of large-scale decentralized applications.
The aim of the EOS system is to emulate most of the features of a virtual computer including the CPU, RAM memory, and hard-drive storage.
The EOS project is being developed by the Block.one company, led by Brendan Bloomer and Dan Larimer, the co-founder of both Bitshares and Steemit. However the EOSIO software is released under the open-source model.
EOS is a newcomer on the smart contract blockchain scene, with the beta test versions of the system released in late 2017. The main system software was released in mid 2018 and is currently still under active development.
EOS aims to become the first decentralized operating system, called EOSIO, providing a development environment for decentralized applications, a social network with monetary incentives, as well as incorporating BitShares.
The EOSIO blockchain currency is known as EOS and was fully released at launch time with one billion tokens being created by block.one.
The EOS currency itself was initially released as an ERC20 standard token running on the Ethereum blockchain. These tokens have since been converted to tokens running on the EOSIO blockchain.
A total of 900 million EOS coins are currently in circulation. The year-long EOS ICO launch is said to have raised a record $4 billion Dollars, a massive sum for any startup.
Block.one have created a $1.1 billion dollar fund called the EOS Venture Capital Fund or EOS VC to assist organizations and individuals in utilizing the EOS.IO system. The aim of this is to help kickstart interest and usage of the system.
EOS has vastly higher capacity and performance specification than Ethereum. EOS’s smart contract platform claims to eliminate transaction fees and also conduct millions of transactions per second.
Unlike some other smart contract blockchain system, EOS does not rely on charging users fees. Instead EOS operates using a so-called delegated proof-of-stake system or DPoS rather than the Proof of Work mining systems used by Bitcoin and Ethereum.
EOS is also designed to operate multi-threaded, that is, it’s able to run processes on multiple computer cores simultaneously in parallel. This makes the system much more processing efficient.
The EOS currency serves as a means to facilitate the provision of bandwidth and storage on the EOS blockchain as well as assigning voting rights to the holders giving them a say in the governance of the blockchain. EOS’s DPoS system allows users to vote for so-called block producers who are remunerated for processing transactions and maintaining the blockchain’s integrity.
EOS.IO Storage is a planned decentralized file system built on the IPFS or InterPlanetary File System. It will be available for participants to permanently store and host files accessible. It’s intended there will be no fee charged for the service.. Rather users will be required to hold a certain number of EOS tokens when they wish to use storage and bandwidth
With the launching of the EOS mainnet in June 2018, EOS wallet support is now provided by the command line-interface of EOSIO, (the EOS operating system, as well as by R1 Elliptic Curve and the Infinito Wallet, which is also used by many other cryptocurrencies.
EOS is presently the world’s fifth leading cryptocurrency by market capitalization.
Most blockchains such as Bitcoin and Ethereum use what is known as “consensus over state,” to verify the current state of the blockchain in order to maintain its integrity.
An alternative to this is to use “consensus over events” in which the transactions are verified as opposed to the state. This method enables the system to handle a far greater throughput of transactions at any one time.
Applications running on EOS will not require fees to be paid by users. Individual distributed applications (Dapps) themselves will be free to decide if they wish to levy fees and the amount they will charge, but the EOS blockchain itself will be free to access in terms of not charging fees.
However, users will need to hold the required number of EOS coins effectively on deposit or “staked” in order to access the EOSIO system. When they no longer wish to use the system, their tokens will be returned.
The EOS token itself is used as a holding currency for users and developers who wish to use applications and services on the EOS platform.
What are the Advantages of EOS?
No Transaction Fees
A major practical feature of the EOS network is the absence of transaction fees for blockchain users
Extremely Fast Processing Speed
The EOSIO system is said to possess the capacity to theoretically scale to conduct millions of transactions per second. This gives it a clear practical advantage over other smart contract blockchain systems.
EOS Uses WebAssembly
EOS is built using WebAssembly as the smart contract and programming language. This enables programmers to use common languages such as C, C++ and Java, rather than being restricted to a proprietary language as is the case with Ethereum.
EOS Uses Delegated Proof of Stake
This is a different system for generating new coins than is used by for example Bitcoin. Delegated Proof of Stake or DPoS avoids the highly wasteful use of electricity for mining that is used by Bitcoin.
DPoS requires users to place a certain set quantity of coins on deposit with the system. This also entitles then to utilize the EOSIO system and blockchain when they wish to run their own decentralized applications.
A More User-Friendly System
EOS is setting out to place more importance on user-friendliness and is trying to avoid exposing users to the geeky technical complexity such as exists with the Ethereum network. All too often this aspect is overlooked by blockchain system developers.
One example of the user-friendliness of EOS is the use of human readable addresses. This is a big plus for EOS compared to Ethereum and Bitcoin. This makes EOS easier to use and reduces the chances of errors and payments going astray.
What Are The Disadvantages of EOS?
The System is Still Under Development
Right now the system is still under active programming development. This means that bugs exist in the system which make it less suited for active production use.
This is hardly surprising since the system was only created a year or so ago. Work is continuing apace on bringing the system up to full production standard.
This means bugs in EOS are to be expected. This is normal process in the development of any software, not least a system as complicated and ambitious as EOS. However this can potentially have consequences for production applications running on the EOS system.
EOS Is As Yet Unproven
Since EOS is still under active development and has not yet seen widespread deployment, the system still has yet to prove itself in practice.
As to whether it will live up to all the hype – of which there has been a great deal – both from the performance perspective, and in particular also in terms of reliability, and avoiding any serious problems created by system bugs, or hacker attacks, will remain to be seen.
Some commentators have expressed concern that the EOS DPoS system of 100 nodes makes the network less decentralized and more at risk of centralization.
Centralization can make the system more open to hacker attack, or make it possible for the integrity of the system to become compromised.
My Assessment of EOS
EOS is definitely a blockchain system and crypto token to watch.
EOS is an ambitious project which has developed extremely fast and has attracted an enormous amount of attention within the cryptocurrency sector in a very short time.
As to whether or not it will become an effective rival to Ethereum in practice remains to be seen.
The founders of EOS have a proven track record with the creation of BitShares and SteemIt and so this is a definite positive plus for the project.
Technically, the system appears to be substantially superior to Ethereum.
Ethereum however is not standing still and plans to implement a series of new innovations over the coming months and years. However the pace of innovation for Ethereum has so far been slow.
There are also other new competitor smart contract systems to EOS, such as Cardana (ADA) and NEO to name just a few.
Often, what gives one offering the ultimate edge over another in terms of market share are practical aspects such as ease of usability. It is possible that EOS may have the edge here.
Not only that but the ability to attract big name users can have a snowball effect of its own in terms of increasing user popularity. Technical advantages alone need not be the sole determinant of success.
EOS has benefited from a great deal of hype and big promises. This was reflected in its highly successful and massive fundraising ICO.
However it always pays for investors to be skeptical of hype and of those who promise the earth. Whether EOS will indeed deliver on all its promises still lies in the future.Disclosures: The above article may include affiliate links for products and services for which this site may receive remuneration. The author or authors may hold investments in the assets mentioned in this article.
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