EOS vs Ethereum: Battle of Blockchains
Unless you are living under a rock, you know that blockchain is going to take over the world. There are multiple applications from finance, supply chain, accounting, Retail, Health & much more.
Blockchain has applications wherever there is an exchange of information which has ‘Value’ — which practically means pretty much every business.
Blockchain space is advancing quite rapidly with many different companies and folks working on various applications and there is a lot of interest from major companies on both public and private blockchains.
Ethereum has been the first public blockchain that revolutionized the concept of decentralized applications which has a whole range of applications from digital certificates, gambling, prediction oracles, and even entire financial instruments being tokenized which led a huge bull market of 2017.
Cryptocurrency market cap reached a maddening 800 billion dollars with just 0.5% of world’s population participating without any major institutions participating which implies a massive potential in this space.
Cryptokitties a game of collectible digital cats become a huge hit so much so that it clogged the entire ethereum network which processes 17 transactions per sec. This showed a glaring need for networks with higher tps
EOS considers itself as a next-generation general-purpose blockchain platform that brings incredible advances on top of what ethereum can offer.
The biggest problems with ethereum that EOS solves are scalability, latency and self- funding.
EOS uses a consensus model called Delegated Proof-of-stake ( DPOS ) wherein 21 Block producers ( BPs) are elected by EOS holders and reserve the right create blocks into EOS blockchain. As these are much fewer nodes compared to the 14000 odd nodes of Ethereum, transactions in EOS as blazing fast ( under 500 ms ) and EOS can run up to 4000 Tps compared to 17 Tps of ethereum.
Apart from this EOS also introduces a blockchain first concept of Consitution which a set of Dos and Dont’s EOS holders are able to do which is enforced by the 21 BPs. Cryptocurrency space is notorious for the number of hacks that take place year on year with over $1 billion being stolen in just last year. The flexibility of EOS allows BPs to freeze rouge actors and hackers and stop them in the tracks which ensures the much-needed peace of mind for EOS investors.
In Words of Dan Larimer —
EOS wants to use the freezing only to enforce the intent of Code as law (not code is the law, which ETH and other blockchains believe in).
EOS clearly is a much-needed improvement on what Eth can offer ( which is a seriously bogged down network with over 80,000 Txs in waiting all the time), however, EOS did attract controversy over its new set of features. Let's try and address them now.
The biggest controversy of EOS is that it’s not decentralized enough with just 21 nodes doing the block production. Hence giving the ability for a state level actor to shut down the network.
EOS network has about 50+ observer nodes along with 21 Main nodes which are all paid to maintain the network and hence have a huge financial incentive to keep running the network, should one or two nodes be taken down in a particular country, two or more nodes will pop-up in no time.
If EOS reaches a trillion dollar market-cap, BPs will make around $500 million annually. This is the type of money is close of GDPs of many small countries, who will be thrilled to host BPs come what may by levying a bit of tax on the income.
Blockchain as a concept is already quite popular that shutting down for no real reason is going to be politically challenging ( South Koreans citizens have signed a petition challenging a prohibitory regulation which has been reversed in the past). Not to mention the enormous money that BPs make being used to sway public opinion to their side.
Shutting down well-capitalized nodes that are geographically distributed across the world is extremely difficult and the difficulty grows exponentially as the number grows. Having 100 or more nodes is practically enough to stop any state-level actors in my opinion. This coupled with the fact that fast, cheap transactions can make blockchain achieve mass adoption which will make shutting down nodes even politically challenging.
Politicians are not thugs ( at least not publicly ), they need genuine reasons to pass laws and strong resources to implement them and look for good returns from these exercises ( most governments have deficit budgets anyway). Shutting down blockchain node owners is an extremely challenging and unappealing job even for the most well-capitalized governments of the world.
Politicians will not be able to find genuine reasons to stop blockchain nodes to rally the masses.
All it takes a couple of killer apps that hook a billion people or more and rest assured it will be impossible to shut down nodes.
Now that you are convinced EOS cant be shut down, let's talk about the reasons why EOS will achieve mass adoption.
Scalability: currently 4000 Tps can reach 20,000 Tps with multi-threading, 1million Tps with sister chains alone ( not channels ).
Zero Fees: EOS is the only chain that gives the option of zero fees and much need features from the UX point of view, users hate paying fees for anything. Instead EOS lets Dapp owners absorb the fees ( sort of like serving hosting fees which devs pay while users have free access)
Custom names: EOS has protocol-level support for account names and let the average user have peace of mind and ease of use.
Hacker proof: hackers will have a very hard time messing with EOS tokens as their accounts can be frozen once their malicious activities are uncovered, giving enormous peace of mind for average investors.
A few more Awesome features that EOS enables
Native multi Sig support. So that you appoint an Entity that can act as escrow.
Worker proposal support. Protocol support for R&D, Marketing ensures devs are not under control of third-parties.
Passive income for EOS holders. EOS holders can stake their valuable coins to dapp developers and earn interest in return
Super awesome developer community
EOS has one of the most thriving developer community that you can think , while ethereum is a bit more mature , EOS is catching up fast and with over 4 billion USD vc fund to fund good ideas , it’s very easy to understand why any dev would build on EOS ( not to mention the ongoing worker proposal fund )
Much more to he listed ☺