When EOS’s whitepaper was first released by its founder Daniel Larimer it received a great deal of attention from the community.
"The EOS.IO software introduces a new blockchain architecture designed to enable vertical and horizontal scaling of decentralised applications. This is achieved by creating an operating system-like construct upon which applications can be built." - EOS’s whitepaper.
Following on from this whitepaper EOS raised $4 Billion in its ICO, the most ever raised from an ICO to date. A lot of cryptocurrency experts are very passionate about EOS, and therefore there’s no surprise that at the time of writing EOS ranks 5th in tables (at $7.2 billion) when comparing the market cap of each cryptocurrency on the market today.
At the time of writing EOS in under development with no minimal viable product realised so far. Thus any conversation regarding its potential to transform the crypto space and uproot Etherium as the blockchain platform can only remain a theoretical one, however, we believe it's a conversation worth having.
The three most significant differences in the EOS and Etherium architecture are as follows:
- Consensus Mechanism
- Transaction Speed
- Smart Contracts
Currently, mining blocks with Proof-of-Work (PoW), but will move to Proof-of-Stake (PoS) soon. The PoS concept states that a person can mine or validate block transactions according to how many coins they hold. This means that the more Bitcoin (BTC) or altcoin owned by a miner, the more mining power they possess.
Currently supports 10–16 TPS. Hopefully, this will be drastically increased once ‘Sharding' has been implemented.
Immutable smart contracts – once signed cannot be changed regardless of circumstance.
Delegated Proof-of-Stake (DPoS). Token holders can ‘elect witnesses’ based on the number of coins they have and only 21 elected witnesses can produce blocks and validate transactions. If an elected witness behaves dishonestly or maliciously, they will be voted out of power by token holders and replaced by honest actors.
Supports 1,000-6,000 TPS (theoretically).
Smart Contracts can be updated. This is very useful in some circumstances although potentially a security risk if bad players, in the form of dishonest and/or malicious witnesses, are elected.
If this is allowed to continue it could make both Bitcoin and Ethereum vulnerable from a 51% attack as a result of collusion between Cartel members. Vitalik Buterin would probably refute this point by saying that it is within the mining pools' best financial interest to operates their nodes honestly in order to continue reaping profits from being block producers. Although his point is perfectly valid, the risk of such an attack remains and is, therefore, something worth bearing in mind.
Furthermore, if Etherium and Bitcoin are at the behest of unelected mining pools would it not be better to use the EOS system of Delegated Proof-of-Stake whereby witnesses are elected on their merits and integrity to mine blocks and verify transactions? Afterall EOS has 21 elected witnesses, and that's many more than the number of mining pools which currently have such a powerful grip over the way both ETH and BTC are mined.
In conclusion, it will be fascinating to see how this plays out, and which DLTs grow in dominance and which become irrelevant. Some believe that there will be one blockchain platform to rule them all, but we think it is far more likely that Dapps will end up running on many different flavours of DLT. In the West, there is always a Pepsi to rival Coke, and an Android to rival iOS so it is very probable that we will see something similar in the DLT space. Some blockchains will have universal appeal for Dapps developers, while others will probably be optimised for more niche use cases.
It's important to remember that we are at the genesis of DLT evolution. Bitcoin was the very first blockchain platform to exist, and Ethereum was the second. EOS is a part of the third wave, but there are plenty more DLTs that don't even use blockchain such as IOTA and Byteball; they utilise something called Directed Acyclic Graphs (DAGs).
As newer more radical DLTs are found that make early generation blockchain platforms appear obsolete, it may be possible for these outdated Blockchains to survive by mutating. This can be achieved by replicating new approaches and integrating them into their platform's protocols via a consensus among miners to upgrade themselves and potentially avoid extinction.
Ultimately, the collective drive for dominance we are witnessing between rival blockchain platforms such as Etherium and EOS is a good thing as it will ensure that only the fittest survive. This will make the DLT space better, stronger, and more resilient, which has got to be a good thing if, like us, you believe that a more decentralised Internet will make the world a better place.