When EOS decided to hold its initial coin offering (ICO) on the Ethereum network, it elicited great interest and sparked a great debate in the cryptocurrency sector. This decision was especially controversial as EOS was supposed to be an improvement on Ethereum with a lot of similarity on the major features. The developers of EOS wanted their ICO to be fair and auditable which led them to use the largest decentralized smart contract blockchain. This decision, though criticized by many signaled the confidence that the EOS developers had in their offering.
What is EOS? EOS is a consensus blockchain operating system that seeks to improve the efficiency of smart business development. It is one of the youngest entrants into the market having started trading in June 2017. It provides the necessary core functionality which includes authentication, scheduling, account permissions and databases giving developers the freedom to focus on customizing the application to suit their business needs.
Block.one raised $185 million in the sale of 20% of the total EOS tokens in only five days of their ICO. This token distribution period which started in June is expected to last 341 days to give people enough time to learn about EOS and keep them from rushing into a quick decision to buy.
1. Zero cost The first feature that caught everyone's attention is the elimination of transaction fees. This is made possible by the ownership model in place which allows users to make use of resources that are proportional to the stake they hold as opposed to paying for every transaction. This means that if you own 5% of the network, you are entitled to 5% of the bandwidth and network storage. This can even be leased out to other people.
This makes the EOS.IO platform ideal to develop freemium applications as the developers of decentralized applications are only required to maintain a certain amount of stake that their applications require. They can then charge the users as a way of monetizing their application.
2. More flexibility The EOS platform has been developed to take advantage of the weaknesses of competing networks such as Ethereum's in which a breakdown on one application disrupts the others. With EOS, if an application fails, it is frozen until a bug is fixed by elected block producers who then update the code. The flexibility also extends to the running of the applications in that you can run the specific parts of the application you require at a particular time. If for example your application offers e-commerce and has social media capabilities, you can enable the local node to only process the data on social media at a particular time.
3. Scalability The EOS platform can process millions of transactions in a second, a very big and welcome improvement on its closest competitor, Ethereum. Even though the two platforms are quite similar, EOS is able to offer its users what Ethereum hasn't; speed. It achieves this through asynchronous communication and parallel processing where a block that has been added to the blockchain never has to be authenticated again as the source code is put on the blockchain.
Should you invest in EOS? EOS is an unproven platform. The team behind it is quite capable and reputable, with the likes of Dan Larimer who is credited with the invention of the delegated proof-of-stake concept, but EOS remains a promise. The infrastructure is still being developed and until we can experience the great promise, it is best to practice a wait-and-see approach. For the risk takers, this is a perfect opportunity to be part of the early stages of a cryptocurrency which even though quite risky, hold great promise of mega profits.