I finally had a chance to meet Brendan Blumer (CEO of block.one / EOS) in person yesterday at the NYC Fintech Conference, where he made a short yet pointed keynote speech discussing "EOS: The Era of the DACs". You can watch it below (it begins nearly 3 hours in, at 2:59:30):
What I found interesting from many of the questions he received afterwards, is that many people still just don't quite get. It was even more interesting to watch the "heated discussion" and twitter spat that took place over the statement he made around 3:09:50:
"Bitcoin and Ethereum are the largest ICOs that exist today. Bitcoin is taking in $8 Million a day, and Ethereum is taking in about $6 Million. We are burning every single resource that people are giving to us."
If you understand what he is saying, he is clearly making a highly valid conceptual comparison, although quite a few on twitter and telegram seemed more interested in "calling him out" as a scammer over minor semantics. I suppose we also know where their money's tied up!
And to clarify, conceptually, bitcoin is like an ICO, and so is ethereum...
- Bitcoin/Eth: "initial coins" are mined to "raise funds" so centralized mining pools can buy ASICs and pay electricity bills.
- EOS: "initial coins" are mined to "raise funds" for centralized platform and community development.
In both cases, resources are going toward centralized entities. Except that EOS is actually trying to build a better mousetrap with all those monetary "resources". What exactly are the bitcoin and ethereum miners trying to build? Instead of wasting energy mining, block.one and EOS are mining "development" instead.
And for those claiming the people behind the EOS ICO are "greedy"... what does greed have to do with it? The market sets the price. Those who think it's worth less, stop buying it! If someone thinks it's worth more, should EOS "politely decline" the extra "monetary resources"? And as far as investments go, maybe I own a few, maybe I don't. I won't recommend EOS one way or the other, except to say that "I get what they're doing, and it has great potential". Furthermore, just as with STEEMIT, where one needn't invest a dime more than the time you probably already waste on facebook, there are many ways to "invest" in EOS beyond merely "buying tokens".
I'll point people towards what I find "interesting", but I've learned long ago that "stock tips" almost never end well. It's up to each of us to "pick our poison". And I'll guarantee you that if I told people I'm "loading the boat on STEEM" while it's at 10 cents (based on my risk criteria and time horizon), there will be some bozo who will come back hating me later, crying how my "advice" got them 100% long STEEM at $3 bucks for a short-term trade, and now they're sitting on a 60% long-term capital loss.
And just as there's no guarantee that investments will work out as you expect, there is not even a presumption that miners will reinvest any new coins in the "best interest" of the bitcoin or ethereum communities as a whole. How many miners do you hear about "working hard" to include "low-fee" transactions in their mined blocks? And of course, there's no guarantee those behind EOS will do what they promise either. I would, however, highly recommend you check out the quality of the code and documentation that's being released almost daily on the EOS github. It appears they may even be taking on a complete rewrite of the underlying graphene engine as well.
If you look at the histories of the individuals behind EOS, and realize the potential of the real world blockchain applications they have already successfully built, well... One must wonder why all current blockchains aren't aspiring to achieve such high level of performance, instead of fighting over minor incremental boosts in productivity and performance. However, I digress...
Who is Brendan Blumer?
We are all aware of @dan's credentials with bitshares and steemit. And Brendan has a rather interesting history of his own. Frankly, what I was most surprised with Brendan (and I hinted this to him straight out), why can't I follow you on STEEMIT?! He does post on medium, and tweet on twitter, so why is he not sharing his insights on STEEMIT as well, and trading more on bitshares, and really getting the point across that this is version 3.0 of this amazing technology. EOS is the "game changer" that can potentially bring all these dapps together under one roof with a better "governance" framework, inter-operable at high-speed and with high-bandwidth through a combination of parallelism and other means. This morning, Brendan made two posts on the EOS telegram chat that I feel I must share so that you can all appreciate a bit more of what I see here:
Brendan Blumer: I started mining as a segue into Blockchain; in fact at one point I was 10% of the ETH hash power. I spent millions on GPU's and electricity, but added no performance to the network. Since I wasn't one of the mining pools, I was out of the communication loop that was tightly controlled by the decision makers.
I unfortunately witnessed first hand how centralized and inefficient the PoW experiment was, but even more concerning was the amount of capital that was moving into the space under the assumption that they were buying into a decentralized ecosystem that didn't have the same inefficiencies or centralized control mechanisms that they were trying to escape; this is when I began looking into PoS, and eventually DPOS to deliver mainstream performance capabilities.
PoW is hiding behind a guise of "trust in math"; although time and time again we've seen that all blockchains are voting machines and it's just a matter of whether token holders vote for themselves or whether their fate is decided by third parties for them (hash voting).
I'm involved in EOS because there is a better way; DPOS is a proven consensus mechanism with aligned interests and mainstream performance capabilities. EOS's introduction of parallelism makes public blockchains possible at scale and Dan's architecture of a messaging platform opposed to a state machine allow it perform like a traditional operating system - this unlocks infinitely more use cases, massively reduces development times, and lowers the required proficiencies for developers to launch powerful Dapps; if you can build a website, you can build on EOS.
The Bitshares, Steemit, and now EOS community is a diverse community of millions and I believe that when empowered with this technology and institutional grade support, they are going to change the world.
Now that's what I'm talking about! I hope more people see this, and perhaps it clicks for them and they really start to "get it" as well. Just like many of us, Brendan was also frustrated in that the current solutions really don't solve many of the issues they "purport" to solve. And here's what I'll call "Part 2":
Brendan Blumer: Existing PoW chains make the requirements for an individual block producer very low. This creates many nodes all over the world but it results in high costs, extremely low performance, and centralization because hardware and electricity are cheaper in bulk.
Equally consequential is the fact that PoW block producers are the law of the blockchain and vote with hash power to make every network decision; they can do this with no tokens and no consent from token holders, and therefore are not directly affected by the outcome of their votes - this is like UK citizens voting for US government. In fact taxation without representation is what led to the American Revolution and creation of the USA.
Five mining pools control the majority of Bitcoin and Ethereum today with over 51% of votes (hashpower), therefore it continually comes down to a 3/5 vote on network decisions; there is no framework for these decisions and no transparency in the decision making process.
DPOS uses 21 elected block producers that can be voted out at anytime by the token holders if they don't feel they're upholding the constitution. The constitution removes their ability to play arbiter and and makes malicious activity less ambiguous and easier to correct.
DPOS is the most used consensus mechanism for blockchains today and has been running for several years, holding billions in value, and has never been taken down by network congestion or DDOS.
Finally, in conclusion...
Brendan "gets it", @Dan "gets it", @officialfuzzy "gets it", and I like to think I "get it" too, at least to some small degree. That's also why @officialfuzzy just made his way all the way up to NYC to check out the remainder of the FinTech conference.
And that's also why I'm about to go back downtown and meet up with Fuzzy... in NYC!!!
And if I'm really lucky, hopefully Brendan, Fuzzy, Dan, and even little 'ole me can hang out a bit and talk about where we really think all this is going...
Now how cool is that?! 😊