Hey guys, I’m Angelo & welcome back to Crypto Coin Consultants. EOS has been a heavy contender in the crypto ring, backed by groundbreaking technology that’s caused its market cap to pump to over $15 billion at the time of this recording. Here’s anything & everything you wanted to know about EOS.
But first, answer this quiz question. â€œIf you donâ€™t believe me or donâ€™t get it, I donâ€™t have time to try and convince you, sorry.â€ This infamous quote arose as part of a conversation between EOS co-founder Dan Larimer and which of the following people? Charles Hoskinson, Vitalik Buterin, Satoshi Nakamoto, or Ryan Fugger.
Let us know what you think the right answer is in the comments section below, and stay tuned till the end of this video to find out the right answer. In the interest of maintaining concision and a flowing discourse, I’ll refer to EOS.IO (which is the proper name for the software) simply as EOS, and make the necessary distinction when referring to the EOS token.
Number 10: What is EOS? EOS is blockchain-based software designed to be highly-scalable and to support the easy and secure development, deployment, and maintenance of decentralized applications (aka apps).
When observed through this over-simplified definition, EOS may bear a resemblance to Ethereum. But there are a few key differences. Whereas Ethereum can be somewhat viewed as a global computer, EOS is more similar to a global operating system. This similarity is reflected in the softwareâ€™s architecture, upon which apps can be built.
EOS provides databases, accounts, authentication, asynchronous communication, and the scheduling of applications across numerous CPU cores or clusters. Through its ownership model, EOS effectively eliminates transaction fees while boasting a potential throughput of millions of transactions per second.
These two key features have gained the EOS project a lot of support within the crypto-community, with the added speculation that it may one day challenge Ethereum as the dominant platform for building decentralized applications.
Number 9: Why Was EOS Created? EOS developers describe it as â€œThe Most Powerful Infrastructure for Decentralized Applications.â€ EOS was created as a way of furthering the blockchain to widespread commercial use with a focus on requirements such as free usage, the support of millions of users, easy upgrades, easy bug recovery, low latency, sequential performance, and parallel performance.
The technological basis for its creation comes from past proven ventures such as blockchain social platform Steemit and BitShares, a decentralized asset exchange. EOS co-founder, Daniel Larimer designed the graphene blockchain technology that powers both Steemit and BitShares.
He also created the Delegated Proof of Stake algorithm that lies at the heart of EOS. Number 8: Delegated Proof of Stake The backbone of EOSâ€™ nimble construct is its Delegated Proof-of-Stake (or DPos) consensus algorithm, which is tailor-fitted to meet the performance challenges required by apps on the blockchain.
21 nodes (also known as witnesses) are elected through voting preference by token holders, and they’re the only ones that can produce blocks. The EOS software enables these witnesses to create blocks every half second. Blocks are generated in rounds of 126 (or 6 blocks times 21 producers).
Every round starts with the election of the 21 unique block producers, and anyone can become one; provided they can convince token holders to vote for them. 15 or more producers must collectively agree on the scheduling order for production.
Forks are unlikely to take place with DPoS, as block production is encouraged to be more of a cooperative process than a competitive one. There is no incentive to misbehave, as this leads to losing oneâ€™s position as a witness and its inherent rewards, consisting of EOS tokens that come with it. In the event of a fork, consensus will automatically transition to the longer chain.
The percentage of witnesses sharing the same consensus is directly correlated to the rate at which blocks are added to a blockchain fork, essentially meaning that a chain with more producers will grow faster. A block becomes irreversible once 15 producers have signed it.
DPoS in EOS comes with an added asynchronous Byzantine Fault Tolerance algorithm, which ensures the 100% confirmation of irreversibility within 1 second. There are some who have regarded DPOS as moving away from decentralization. Ethereumâ€™s Vitalik Buterin has noted that DPoS concentrates power in a small number of full nodes that holders have to vote for, and that is hence known by everybody.
Buterin saw this as a vulnerable aspect and stated that DPoS makes it much easier to attack the people running the nodes. Number 7: Scalability The developersâ€™ description of the EOS software highlights that it enables the vertical and horizontal scaling of decentralized applications.
EOS relies on Graphene technology, whichâ€”as stress tests have demonstratedâ€”can achieve between 10,000 to 100,000 transactions per second. The open-source EOS software is scheduled for release in June of 2018, and even though it’ll run single-threaded, it’ll allegedly include the necessary data structures for future parallel execution.
Asynchronous communication and parallel execution are key features to ensuring EOSâ€™ infinite-scaling potential. EOS effectively separates action from authentication, which is only required once a block is produced. Users wonâ€™t have to go through the process again once a block is irreversibly added to the blockchain. The human-readable source code is placed on the blockchain for everyone to see, and developers can compile it on different machines with the necessary optimizations, all the while maintaining consensus.
Since the network allows for transactions to take place in parallel, it basically means that multiple processes donâ€™t have to wait their turn and queue up. By splitting up transactions across multiple computers and CPUs, large scale apps can effectively reduce the workload. Number 6: Flexibility EOS users will be able to selectively run applications they need and configure nodes to process data they want.
It, therefore, wouldnâ€™t be necessary to run social media apps if the desired process is to run an exchange. Operational maintenance of the blockchain doesnâ€™t require the participation of every node. An added flexibility feature comes from the DPoS consensus mechanism, which gives block producers the power to freeze an application if it isnâ€™t working properly.
This means that potential bugs can be frozen, fixed, then the source is updated without disrupting the blockchain, as weâ€™ve seen in previous cases like with the DAO hack of 2016. EOS has also been designed with inter-chain communication in mind, and this, in short, is achieved by facilitating the generation process for proof-of-action existence and proof-of-action sequence. Number 5: Usability As Iâ€™ve mentioned before, EOS is built like an operating system with user-friendliness in mind.
In fact, one of its more charming arguments for massive implementation comes in the form of usability. Developers wonâ€™t need to concern themselves with writing a ton of code, as an array of integration tools are available to them. Interface development will be made easier by EOSâ€™s web toolkit. EOS will include self-describing database schemas and self-describing interfaces, meaning blockchain data will be human-readable.
It’ll also support many of the known programming languages such as Rust, Solidity, and C++. In addition, it uses a declarative permission scheme that enables a finely-tuned delegation of permission across accounts. The accounts themselves will feature a human-readable, user-friendly name of up to 12 characters long.
They’ll have two native named permissions: â€œOwnerâ€ authority will be required by few transactions, and developers recommend keeping login information in cold storage and not revealing it to anyone. It can be used to recover permissions that have been compromised.
â€œActiveâ€ authority will manage voting for block producers, transferring funds, and other high-level account changes. Aside from native permissions, account management will feature custom name permissions for desired use cases. On the user end, EOS will behave like traditional websites and wonâ€™t infer any fees for using an app on the platform.
Number 4: Governance Governance in EOS is placed in the hands of the token holders and the block producers they elect. The EOS software also features what is described as a â€œconstitution.â€ The EOS constitution is a set of mutually accepted rules, similar to a binding contract or a peer-to-peer terms of service agreement, which users must sign.
It serves as a tool for dispute resolution by establishing jurisdiction and choice of law. The signature on each of the transactions taking place on the network must include a hash of the constitution, therefore binding the signer to the contract.
Changes to the constitution and protocol upgrades are done through a process that initially requires the approval of at least 15 block producers.
Number 3: Utility It’s necessary to mention while on the subject of the EOS token that its power becomes real on a launched blockchain that integrates with the EOS.IO software. As the disclaimer written in caps on the EOS technical whitepaper will tell you, features of the EOS token donâ€™t refer to those of ERC-20 compatible token currently distributed on the Ethereum network.
The company currently building the EOS software has stated that it has no intention of launching any public blockchain adopting said software after its open-source release. The distinction between â€œsoftwareâ€ and â€œplatformâ€ has been very stressed upon. EOS.IO is the software currently under development, while the EOS Platform will be used to refer to the blockchain that adopts it.
A developer disclaimer therefore reads: â€œThe EOS Tokens do not have any rights, uses, purposes, attributes, functionalities or features, express or implied, including, without limitation, any uses, purpose, attributes, functionalities or features on the EOS Platform.â€ Moreover, the very term â€œEOSâ€ has been given an open-ended interpretation, where it can mean whatever you want.
This combination of volatile factors have solidified as a red flag for some, while others regard it as a way through which developers have taken measures to cover all their bases. Nevertheless, on a launched blockchain using the EOS software, the EOS token was designed to follow an ownership model instead of a â€œrentalâ€ model, which effectively eliminates transaction fees.
This model gives EOS token holders access to the networkâ€™s storage, bandwidth, and processing power proportional to the stake they hold. For example, 1% ownership of EOS tokens means that regardless of the load on the rest of the network, you’ll always have access to 1% of the networkâ€™s total resources to use at your discretion.
Increasing the volume of available network resources is achieved by purchasing more EOS tokens. This enables developers to gradually scale up their applications while also receiving reliable bandwidth and computing power. Aside from the initial purchase of EOS tokens, zero transactions fees mean no network development cost.
EOS tokens also constitute a tool used in the voting process that decides which nodes will become block producers. Itâ€™s necessary to become an EOS token holder in order to obtain voting rights. Number 2: Token Distribution Hereâ€™s where it gets a little tricky and a bit ironic.
Even though EOS is being groomed to be a heavyweight contender for Ethereum and has received the sought-after â€œEthereum Killerâ€ moniker, its developers have chosen to hold their rather unique ICO on the Ethereum network.
Of the total 1 billion EOS token supply, 200 million were available for purchase during a five-day window that started on June 26th, 2017. During this time, the team raised around $185 million in Ether in exchange for 20% of its total supply.
700 million tokens (or 70% of the total supply) would be scheduled for distribution during 350 evenly split consecutive 23-hour periods of 2 million tokens each, starting on July 1st, 2017 and ending on July 3rd, 2018.
At the end of each round, the EOS tokens sold are distributed pro-rata among authorized buyers based on the total Ether contributed during that period. 10% of the total supply would be reserved for the developing company and isnâ€™t eligible for trade or transfer on Ethereum during the distribution period.
One unique aspect of this distribution model is that the trading of EOS tokens will have begun during the ICO; hence the majority of tokens will have been produced and sold at market value. This model was chosen to avoid the frenzy surrounding a short distribution period that only allows a relatively small number of people to take part in the ICO.
The elongated timeframe was created to give people ample time to make informed decisions about acquiring EOS while also learning about the project and observing the software’s progress. Number 1: Who Is Behind EOS? As of the creation of this video, EOS is a top ten currency, despite what some have referred to as its â€œhighly unpredictable futureâ€ in which an EOS token will essentially become hollow.
Skeptical voices have expressed even less faith in when and whether an EOS blockchain would ever be launched. Among the skeptics there are those who wonder why block one (the company behind EOS) is based in the Cayman Islands.
An obvious explanation is that it was established there for tax purposes. But some claim that the location was chosen to limit accountability should EOS prove to be an ample scam. EOS conspiracy theories have taken many forms, but this is often the case with potentially disruptive projects in the crypto-verse.
The confidence the community has placed in EOS boils down to the ambitious technology and the strong team behind it. Brendan Blumer is blocked oneâ€™s CEO and Brock Pierce is its CSO, while blockchain veteran Ian Grigg serves as an EOS advisor. Grigg invented the Ricardian Contract, co-invented Triple-Entry Accounting, and has been building cryptographic ledger platforms for over 2 decades.
Despite the familiar faces and solid reputations, most of the weight that comes with EOS will be shouldered by one man: block. oneâ€™s CTO, Dan Larimer. He invented the DPoS algorithm and Graphene technology that powers Steemit and BitShares; both successful ventures that he also founded. Larimer has been regarded by some as a controversial figure of the snake-oil salesman kind in the blockchain community.
Be that as it may, itâ€™s hard to ignore his appetite for innovation or technological prowess as well as his vast experience and previous achievements. In the end, whether EOS soars to the moon or crashes in the dirt, it’ll most likely be Larimerâ€™s head holding the crownâ€¦or jester hat.
So which of the following people as part of the conversation with Dan Larimer? If you guessed Satoshi Nakamoto, you’re right. The quote was from July of 2010 & occurred on a Bitcoin forum, the topic of which was scalability and transaction rate. It arose as a reply to Dan Larimerâ€™s concern that a 10-minute payment verification on a Bitcoin micro-transaction was too long.
Before delivering the now-infamous quote, Satoshi tells Larimer about a potential payment processing solution he had presented in an earlier thread.
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