A Primer on EOS, why it grew 320% overnight and why it isn't done yet!

in eos •  5 months ago

Maybe you missed it. I almost did — in fact despite carefully tracking ICOs this summer I almost let this sleeping giant slip through my fingers.

Unlike some of my other posts, I can’t even tell you that it was my research that helped me uncover this find. Rather, I just happened to be awake at the right moment when a Kraken blog post landed in my inbox.

Kraken isn’t my normal stomping ground for trades, but I follow their updates quite carefully.

Unlike many exchanges Kraken has been selective in which trade pairs they add to the exchange — and as someone who was previously a director at a crypto exchange and had to make these decisions, I know how hard it can be to make the right picks. But, Kraken has always done a great job in including mostly winners (although I’m still skeptical about Melon). So when I saw they added an asset I hadn’t heard of I realized there was something I missed.


What is EOS?

EOS is the latest project by experienced blockchain entrepreneur Dan Larimer.

Dan was the creator of BitShares, STEEM (+ The SteemIt platform) and BitUSD three projects with a combined market cap of $886M and he is now the CTO of the company block.one who is building the EOS platform.

So what exactly is EOS?

In their own words EOS “is software that introduces a blockchain architecture designed to enable vertical and horizontal scaling of decentralized applications.”

What does that mean?

Right now, there are hundreds of major companies, banks and governments looking to build enterprise level applications on the blockchain, and leverage the smart-contract technology of Ether.

The problem is, as we’ve seen with the rise of ICOs this season, these technologies don’t scale well. The goal is to change that by creating a system designed for enterprise level adoption, that allows large corporations to build DAPPS (Decentralized Applications).

Can’t Bitcoin and Ethereum handle enterprise DAPPS?

Short answer: No.

Longer answer: Not yet and not on the current infrastructure.

On June 11th 2017 the Ethereum network was hammered with traffic and pumping out 5.2 transactions a second. Which seems like a huge success! However, taking into consideration that on June 20th during the status ICO the Ethereum network was bumping out 5.04 transactions per second and that some users were waiting hours for Ether to send, it turns out the network can handle a pretty small volume.

While for cryptocurrency 5.2 transactions per second is a huge milestone, it fails in comparison to the number of transactions that someone would need to host an enterprise level solution on the blockchain.

In Dan’s EOS presentation at Consensus 2017 he highlighted the number of transactions per second of a few consumer services.
Before we even get to being able to run stable financial markets on the blockchain, we’d have to break through barriers to even be able to support the transaction volume of social networks.

Facebook alone pumps out 52,000 likes per second. Not posts, not messages, JUST likes.

That means in order for Facebook to run just one component of their system on blockchain technology would require a platform like Ethereum to be 10,000x more efficient than it currently is.

Isn’t this just a node/miner problem? Can’t we solve this with more Engineers?

The speed of the network isn’t simply a function of miners, nodes or hashing power. It comes back to the fundamental way in which a blockchain functions.

The over simplified version is that on a current blockchain information is processed in a sequential fashion in the order of each block, and without implementations of modified structures like the Falcon Network the sending of this information doesn’t start until the full block is complete.

Even modified implementations have their limits. Take for example, the Kik’s upcoming implementation of “Kin” — despite being a $1bn unicorn startup with significant engineering resources, Kik announced that Kin would need to implement “a hybrid on-chain and off-chain solution” to keep up with the transaction volume.

A few years ago in the early planning stages of Kin, Kik launched an experiment called “Kik Points” allowing users to earn a traditional currency in the app. They monitored the number of transactions they were seeing and compared it to the Bitcoin blockchain:

At their high-point they were seeing 7x the number of transactions that the Bitcoin network was, and Kik has only continued to grow over the past 3.5 years.

So, What is the Solution?

That brings us back to EOS. EOS has the goal of creating essentially a developer friendly operating system that allows both private and public blockchains to, among other things, process information in parallel across multiple cores rather than restricting it as a single thread.

EOS also introduces a few other concepts to make blockchains more accessible to the enterprise client:

  • Separation of read and write actions for sake of speed.
  • The ability to communicate asynchronously between public and private blockchains.
  • The ability to manage user accounts with different permission levels.
  • Account names instead of long addresses.
  • The ability to fix bugs and role back changes with super-majority consensus instead of needing a hard-fork.

These features rely on a change of infrastructure referred to as “Delegated Proof of Stake”

Some cryptocurrency hardknocks argue that this ultimately makes a blockchain ‘less decentralized’ and while that’s true it’s important to realize that companies like VISA and IBM who are spending hundreds of millions of dollars on this technology were never going to adopt a fully public blockchain anyway.

So what’s the value of the Tokens

Ultimately the goal of EOS is to act a a simplified operating system for large businesses to adopt blockchains, and after the crowd sale ends on July 3rd 2018 there will be consensus vote among token holders to create a blockchain.

As long as enough holders vote for the creation of a public blockchain that follows the EOS.IO infrastructure then the tokens will be able to be bought by businesses in order to build and use their private blockchains via the EOS platform.

And, so while there may be risks in the future of this token, the team behind it has a wealth of experience in delivering products and is tackling some of the biggest challenges in the blockchain space. If they manage to deliver then EOS will likely change the landscape of blockchain tech forever.

If the coin manages to beat out the market values of projects like Bitcoin or Ethereum then it would be worth an estimated value of over $35 a coin one day. That's why I think this little token isn't nearly done growing yet!

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Price is too high. ICO only got started.

Great article...I am trying to wrap my head around this... Can you recommend an article which explains how the eos tokens would be valuable? It sounds to me a bit like a business just buys an eos token like an anchor and then just uses its private blockchain... a bit like sidechains or something like that?

I would love to know more about that, but would like to understand why the eos tokens would have to be bought...

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They give you a percentage share of the blockchain's storage and computing power. The number of tokens you own determines your access to the network.

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Ok, so this is the same like in Steem... But if you run your private chain would you need many of them?

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Does this article means death to other cryptos like Bitcoin, Ethereum and etc. because EOS is faster ?

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I found the white paper... so will give this one a read... looks interesting... :)

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Yeah so basically the tokens they issue will all get to vote on July 4th 2018 to try and form a formal blockchain. If it implements the guidelines of the EOS.IO system it will create a public blockchain that follows that standard and companies would need to use those tokens to make applications on that blockchain (at least that's what I understand).

While they can also create their own private blockchains based off of EOS I imagine some of them will want to interact with a public blockchain which would need to be this EOS token one.

In summary, what I gather from the whitepaper is the goal is to have the current tokens become a key component of the platform, they just don't want to promise that for legal reasons incase someone gobbles up enough tokens to out vote them.

EOS is really interesting. Thanks for the great post. Dan the creator has made Steemit/Bitshares and so far they are doing good so I think he will do a great job in this project too.

So you're saying Kraken is the reason for the pump? I'm going to have to disagree and say that it was all the US investors that "couldn't get in the ICO", because of the "regulations scare".

I realize many ignore that entirely and it's just a formality, but you have a lot of people out there that will follow that quite literally.

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I don't think Kraken was the reason for the pump - I think there are a lot more factors at play, but I agree US investors who didn't want to touch the ICO are likely a major component of that.

Heck yeah!!

Thanks for this good article as ever. I've just started following you. People might also like the one I posted on criteria for choosing what to put in your long term crypto portfolio. https://steemit.com/crypto-news/@katythompson/5-criteria-for-choosing-a-winning-long-term-crypto-portfolio

This is such a great post - clearly explaining the technical advantage of EOS - which I am convinced of! I do think it will get to the same value as ETH within 2 years ;-)

Also worth bearing in mind is the exceptionally clever way they are raising money - they are now already the best funded blockchain platform and will continue to be so, as they will most likely raise between $1 to $3 billion over the course of this year.

If any readers would like to understand more about the structure of the ICO year long token offering for EOS and why and how it will raise so much money and why having so much money will make it even more likely to be a serious competitor to Ethereum please see my various posts on this on my blog @willstephens .

Have a beautiful day y'all,

Will

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Agreed Will! The ICO deployment is a fascinating aspect, it means that people who invested early have a vested interest in driving the price up each day. It'll be interesting to see how it all plays out.

Just buy it, but it drop... I feel very sad on it.

Hi @adamscochran.. A nice article you have here and if the $ is to be believed a very successful one as well... Even I had tried a small article on EOS (below) but didn't garner much traction... It would be a great help if you could take a look and proved your critique comments on it. Thanks 👍✌️

quote
Since you are in this post then I would imagine that you already have some idea about EOS.IO, but if you are a complete newbie on the topic then also you are at the right place. So let me start by giving a brief overview of EOS.IO, before we get into the details of it.

What is EOS.IO Platform:

EOS.IO platform is the newest entrant on the market which is based on the blockchain technology. Its architecture has been designed to keep the philosophy of horizontal & vertical scalability of any DAPP (Decentralized Application) at the epicenter.
In order to achieve such a feat the developers have created a operating system like construct, upon which all these DAPPs can be deployed.

Salient Features of EOS.IO Platform:

The platform provides Accounts to the DAPPs developers.
Authentication is also taken care by the EOS.IO system itself.
The database is an integral part of any application and it is provided by the platform.
Parallel processing etc.
Scalability

What Makes it an Ethereum Killer:

EOS.IO can cater too millions of transactions every second, which is totally unprecedented in the blockchain ecosystem.
It is the only blockchain platform that is free to use for the users. This empowers the developer & the business community to formulate and implement their own monetization strategies.
The EOS.IO platform is robust enough to provide flexibility, to the developer, to fix any bugs in the code, should the need arises.
Blockchain technology still lags behind on the front of latency. The EOS.IO tries to correct that by ensuring lowest of latency possible.
Any application that can not be implemented on a parallel algorithm, due to the very nature of the business, EOS.IO provides a robust and fast sequential performance platform.

To be continued…

References-EOS.IO Technical White Paper

I'm making the crypto world friendly and accessible for everybody by explaining acronyms and terms related to cryptocurrency. Here I found:

EOSERC-20 compatible token that may have no value, distributed on the Ethereum blockchain pursuant to a related ERC-20 smart contract (the “EOS Tokens”)
ERC-20A token standard of Ethereum, which defines a common list of rules for all Ethereum tokens to follow, meaning that this particular token empowers developers of all types to accurately predict how new tokens will function within the larger Ethereum system
EOS.IOSoftware that can be configured based on an EOS ERC-20 token distribution
ICOInitial Coin Offering is a means of crowdfunding the release of a new cryptocurrency, the tokens being sold to raise money for technical development

Please upvote for visibility. If there are any missing terms here you want to be added to the database, please comment, so I'll become better.

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I'm trying to come up with a good one-line definition of EOS.IO that isn't too technical such as "EOS.io is open source software that will do parallel blockchain processing enabling a virtually unlimited number of transactions per second. "

Great writeup about EOS. Thanks! I am in this one until it becomes a household name.

Watching the video.. looks awesome 🔥🔥💯💯

a great post. thanks for the insight.
followed, upvoted and resteemed

Please visit my blogs @riz-cryptonian and share some community supoort as well.

Is it just me who avoids pre-mined tokens?

How could you possibly miss it? It's 365 days long. I'm just waiting for the cheapest day to enter as we are now approaching less than $1. I feel sorry for the people paying $5 a token.

Good information, thanks!

I still have difficulty distinguishing EOS from Ethereum. What really sets it apart and why should I be looking for an overseas investment partner TODAY?

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Etherium wastes electricity and processing power doing things that EOS considers pointless.

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EOS aims to be like ether but faster, with account controls and easy to use tools for private blockchains.

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Thanks for the reply...everything seems to point towards the speed and efficiency, which I suppose is a big deal given the resources necessary.

Much ❤
@Tayken

thank ... ihave been looking the articles like this.

Eos token On kraken& bitfinex. Cool.

I hope so,, I like this coin 😁

Great informative article.

If you Want to Be a good Trader. First you should have Peticene Then You have to Analysis Coin Graph. Without First…

Good post. How are you on steemit and you missed EOS haha!?

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I actually found SteemIt because of EOS!

423% on hitBTC
thank you for this primer>
i shall thoroughly read
and post this link on my post "Totally Mad EOS up 423%"

Craig Wright begs to differ on whether Bitcoin can scale to handle DAPPS.
https://steemit.com/bitcoin/@belerophon/in-defense-of-craig-wright-part-1

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And he may be right - there are a lot of different opinions, but Bitcoin today without a hard-fork is not going to scale to handle DAPPS - where as EOS will be designed to do so from the ground up.

good post, gonna get me some eos soon I think.

Need to buy bitcoins?
buy_bitcoin_instantly_blue.png

still trying to really understand this. Great article though

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To sum it up, or in other words, EOS will be number 1. :)

Btw, it grew 650% overnight.
At least mine :)
Atm, the price is falling and will continue to do.
The only reason it rocketed on stage 2 -- is ppl' idiocy
when they don't know how to use their calculators.

I have been trying to get a better understanding of EOS and this article helped me understand EOS as a solution and the value that the token provides. Thank you for spelling it out!

Sure Kraken listed EOS, however coin schedule didn't even mention them. I bought into EOS at $6 the second time. And since then I've lost more than 50%. I'm fairly certain that a lot of people that are still left holding bags of EOS are people that paid more than $3 a coin, with that being said do you feel as if the price has solidified or can we still expected to decline back to its Ico price? Essentially half the value of the coins been sucked out in the last 2 days and that equates to hundreds of millions of dollars. With all the new icos happening in July, there are plenty of new options on the horizon for these whales to make money on a new coin so why would they go back to EOS?

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The price has already shown some nice support in the $2.50-3.00 range, and there is little chance it will fall back below $1 in my opinion, but these "bag holders" you describe will most likely want to ditch this TOKEN (not coin) while it slowly loses market capitalization. I will tell you I sold off over 300 tokens mostly at a loss so I could reposition and ride the daily volatility while it finds its comfort zone. The problem with all of the new ICOs is that some of them have been misleading investors and I even read that Bancor was built on nothing but a promise and "40 lines of untested code". If anything is going to hurt the market it's going to be the plethora of overpriced and overhyped ICOs in the next year. By the way market capitalization does not represent the amount of money ACTUALLY spent or lost by a coin/asset/token- it only represents the current market price TIMES the circulating supply. If you think that a platform, which by the way has not even been developed on yet, is already worth roughly half a billion dollars overnight then you've lost your mind. Hype cycles drive this entire economy and when you realize that you will have opened your eyes.

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LOL thanks for enlightening me. I don't know if I should feel scared or happy. A part of my wants to take my $8000 in profit and run seeing I've never made a return like that before, another part of me want to hold. I would like to buy another 1000 or so EOS in the short term, however I will give it a few days to see where it goes. This is the first time in a few days that It has been stable over $3.00 and it is back up to 10th place for 24 Hour volume, so only time will tell

@adamschchran very glad you joined steemit - good to have your insights and experience

This is exactly what I am telling people. I bought some EOS and I am holding for the price and for the technology that Ethereum can't and won't provide.

Congratulations @adamscochran!
Your post was mentioned in my hit parade in the following category:

  • Pending payout - Ranked 7 with $ 826,87

Its all so clear now. I've been reading about EOS for a while now and only am just understanding what its all about. You are so knowledgeable!

Nice blog

I am seeing some folks say NOT 😱to get into EOS. Lol. I am already in and loving it🤸. I am ready to ride this think out for the long term. I am sure there will be ups📈 and downs📉.

such a perfectly timed post, i had seen lots of EOS from crypto people gushing about it but i needed data. you brought that, so thank you!

Good article, but DPOS consensus algorithm is arguably more decentralized than POW used by Bitcoin, since a handful of pools effectively control the Bitcoin network, while in DPOS number of elected block producers is usually set higher.
More info on DPOS here:
https://bitshares.org/technology/delegated-proof-of-stake-consensus/

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I agree - and I noted this in my article. The thing is since the target market for this blockchain is corporations they are going to want to have something that is at least slightly more centralized than PoW.

It's like taking baby steps!

Current EOS tokens are not for any use on real upcoming EOS. I dont know what that EOS currency will be ? Do you guys have any info on that ? what that currency will be and when we expect it in the exchanges ?

Very informative, thank you. I'm going into coins, trading and the lot so I'm taking it all in. Can you recommend any other article or guide please

VERY INFORMATIVE, KEEP IT UP

Such an exciting time for Crypto! Thanks for the fantastic article @adamscochran

Great article man, gave it a resteem

Great post, very interesting what is developing moving forward in the crypto world, what is the current value of the token?

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To find the latest average value of any cryptocurrency as well as its trading volume, market cap, charts, and links to its website, block explorer(s), and any pertinent blogs and/or forum posts about the coin (like bitcointalk), the best place to begin is https://coinmarketcap.com/ . If you click on the Markets tab you'll find a list of all the exchanges on which the coin is currently being traded, which markets/coins with which it's being traded (BTC, ETH, USD, EUR, CNY, WAVES, etc), the current price (by default USD, but you may change this to BTC, ETH, or your choice of 14 other fiat currencies) of the coin in each of those markets, and the % of the total traded volume of the coin for each market. The Social tab gives you links to Twitter and Tools gives you code for a price widget for the coin and also the link to coinmarketcap's api for it so you can remotely call for price updates in applications like trading bots. Historical Data is pretty self-explanatory. It's the charted values in spreadsheet form. With all the explanations now aside, go ahead and get started with the currency you asked about:
http://coinmarketcap.com/assets/eos/
Hope this helps!! Learning about this site is what really got me into trading digital currencies!!

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$3.15 usd for a market cap of circa $550M

I certainly hope you are right my friend and thank you for the post, it has very helpful information.

One of you're great article again . I yhink EOS it will be a big project , a scale one . Yes it needs time , but still , it will be a good one

In as much as i"m a newbie ,your write up is clear and comprehensible. Kudos. I really missed the ICO anyway, hoping Dimcoin would be unique too.

It confused me as well. I was looking at the coin market list and saw eos at the bottom.
yesterday it was somewhere mid-top with $2.
Good job.

Thank you so much for this article. Well written friend. I think there has been so much positive and negative options on EOS but this is so great.

I missed it. But never late to buy right now. I believe in this project. Thanks for this awesome explanation.

I am tracking the github repos, so far development has been great.
i love the code, looking forward to contribute as well.

great Post! I love EOS

I'm wondering when we will see production or at least test network. After a year or so?

looks like EOS is one to watch. Was a little bummed people in US could not participate.

Why do people say EOS is the death of ethereum?
If EOS works within the block-chain?

Maybe I miss understood something or maybe referring to its ICO bogging down the network. Great read. Thank you.

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Yeah, as I understand it, EOS sits on top of Etherium. so if Etherium where to die off due to lack of bandwidth, EOS would crash along with it. That is what is holding me back, however I am still trying to get a Kracken account going to at least buy up a few hundred bucks of it and see what happens.

Just make sure to register your EOS tokens otherwise they can be worthless.

Looks done to me!

great article. i have read it again before i realized that it wasnt a familiar post but something i had read before and upvoted

While I do not doubt EOS value and the disruption it will bring next year, I still think purely from 'price' perspective, it is TOO Hyped.

Thanks for sharing.... followed ya

Subscribed.
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That brings us back to EOS. EOS has the goal of creating essentially a developer friendly operating system that allows both private and public blockchains to, among other things, process information in parallel across multiple cores rather than restricting it as a single thread.

😲😃 ... ooooooohhhhh, so that's why EOS is suddenly everywhere. Parallelization! I was researching EOS to try and figure out what makes it so special relative to any other smart contract blockchain platform and what it can do that Ethereum can't.

I'm no coder but that makes perfect sense. Thanks much for the clarifying info 👍

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