EOS Whitepaper Walk-through: Abstract

Read the Whitepaper here

The whitepaper starts with the abstract and the disclaimer and they are definitely worth reading and paying attention to.

Abstract: The EOS.IO software introduces a new blockchain architecture designed to enable vertical and horizontal scaling of decentralized applications. This is achieved by creating an operating system-like construct upon which applications can be built. The software provides accounts, authentication, databases, asynchronous communication, and the scheduling of applications across many of CPU cores or clusters. The resulting technology is a blockchain architecture that may ultimately scale to millions of transactions per second, eliminates user fees, and allows for quick and easy deployment and maintenance of decentralized applications, in the context of a governed blockchain. 

That's quite a bit to unpack, let's go through them one by one.

A new blockchain architecture? 

If we take a look at the blockchain landscape, a vast majority of them is either:

1. Bitcoin Forks
2. Ethereum ERC-20 tokens.

These cryptocurrencies relied on pretty much the same technological foundation as Bitcoin or Ethereum. 

Or very similar iterations of these two technologies.

EOS builds on different foundation, its development began with BitShares, then continued with Steem. Which was release in 2014 and 2016 respectively. 

Bitcoin was released in 2008 and Ethereum was released in 2015.

The biggest difference between Bitcoin, Ethereum and EOS are two-folds.

1. Bitcoin and Ethereum (as of now) still depend on a proof-of-work model to secure the network and distribute tokens.
2. EOS has a delegated proof-of-stake model to secure and distribute tokens.

Read more about the differences here.

What does vertical and horizontal scaling mean? 

• Vertical Scaling

When people talk about scaling today, they usually mean the number of transactions. Currently transactions are limited by two things: 

1. Size: The amount of transactions in each block update and the size of the block.
2. Speed: The time between each block update.
3. Coordination: The time it takes for a transaction to be confirmed.

Scaling has a been a issue in the blockchain space since the very beginning, and it was addressed in the original Bitcoin whitepaper. 

Currently the Bitcoin blockchain can do any where from 3 to 7 transactions per second and Ethereum process about 10 to 13 per second.

There are usually two approaches towards scaling: change the protocol itself, or build second-layer protocols to mediate the traffic. 

• Protocol change 

Changing the protocol involve things like increasing block size or decreasing block times. Second layer solutions basically another blockchain on top of the existing one. 

Changing to protocol means hard-forking, and it is from this that Litecoin and Bitcoin Cash came into existence.

• Second-layer

Second layer solutions are technologies like Lightning network, which, while it relies on the Bitcoin blockchain, run another blockchain with its own infrastructure.  This avoids the need to change the protocol itself, which can be a very difficult process.

• Horizontal Scaling

Horizontal Scaling is not something that usually occurs in blockchain space, but it is something that is commonly done in video game processing..

Financial transactions are depend on the having a reliable sequence of events. 

If Alice sends Bob a payment and Bob wants to send Cindy a payment, assuming Alice is the only person with any money on her account, this happen in the order prescribed.

Within any traditional block update, these two transactions cannot be processed at the same time. This would cause Bob's transaction to be rejected, so in order to pay Cindy, he must wait for the next block.

However, if we change the model from that of transactions (UTXO) to one of account-based, these account updates can all be done within the same block update. 

So instead of transactions, we are adding or deducing from accounts. If we further limit each account to only have one sending (-) and one depositing (+) operation, then as long as the operation as logical (no account will have a negative value at the end), then all the updates can be processed in a single block.

Each account would be limited to one transaction, but the number of accounts are only limited by hardware limitations. 

In this model, the amount of transactions only depend on the thread count and the number of computer core on a CPU or GPU.

Further more, in this model, because each transaction does not have to rely on the previous one in block update, the more CPU and GPU you add, the more transactions you can process per second.

Read about it more here.

What is an operation system-like construct?

Most of us are familiar with operating systems. The most popular ones being Windows, MacOS  or Linux. 

We might have one or multiple accounts on our operating system; one for yourself, maybe another one or two for your family members.

And we usually run our favorite applications on top of them, whether it be a web-browser or photo-editor or audio production software.

On these operating systems we store our personal files, and for the more advance users, decided which other account can access which files.

But what does an operating system on the blockchain mean?

Similar to traditional operating system, on the EOS.io you would be able to create accounts, store files, run applications, and set permission level for file access.

A governed Blockchain?

Blockchain, like any other pieces of technology, is created and maintained by people. And when there is people, there is conflicting interests and ideas, different direction people want to go.

There are ungoverned blokchain, which is like the Bitcoin community. When there is a dispute in the bitcoin community, there is very little in the ways of coming to an agreement and making changes to the protocol. 

If a big enough majority of people decide to, they can fork the blockchain and create their own cryptocurrency. This was the case with Litecoin and Bitcoin Cash. 

Ethereum is similar but has a large, private external foundation that controls most of the talent in the ecosystem. Though there is still no formal way to make decisions on the blockchain.

In governed blockchains, there is a mechanism built into the protocol to allow for proposal to be adopted or rejected.

Steem is another project, and a good example of what a governed blockchain looks like. Special positions and rules are put into place that allow for changes to be made in a quick and efficient matter.

In the next article I'll go over the notes and the disclaimer, and why you should pay attention to it if you want to know how to launch a token without getting into trouble.

If you would like to know more about me and what I'm doing you can read my introduction post here.

Read my series on the Steem blockchain:

Steem: Welcome to the Matrix. Part One

Steem: Operating in the Matrix. Part Two

Steem: Construction of the Matrix. Part Three

And you can contact me in the following way: