Ethereum is in for some serious competition from this up and coming blockchain protocol. EOS touts itself to be a decentralised application development protocol, which will revolutionise the way users create dapps and transactions thereof.
What is EOS?
It was developed by Dan Larimer in May 2017. It is set to be a blockchain platform similar to Ethereum, which will allow developers to build their own decentralised applications on the platform, through a server that acts like its own operating system.
Through its scalability, flexibility and usability that supersedes that of the Ethereum platform, its aims to bring the best of the blockchain world to its users. Why does it supersede Ethereum? Visa produces 1667 transactions per second and Ethereum just 20 per second. This is one of the reasons Blockchain is predicted to fail. EOS promises to support millions per second. The key difference is that EOS uses distributed proof of stake (more about it below) and not proof-of-work to verify transactions.
Value of EOS
When it was first launched in 2017, it managed to attract over $185 million in ETH investments. Today, the coin is valued at $4.71, with there being over 906 million coins in circulation. The total volume of coin exchanged is $862,331,045. The highest value the coin ever reached was $22.71. The coin has a market cap of $4,270,849,858.
Technology behind EOS
It aims to be a complete solution for developers looking for a platform that is as stable as Ethereum but is also secure, scalable and flexible.
EOS is more like an operating system. Just as an operating system allows you to build applications within it, EOS allows developers to build decentralised applications, or dapps, upon it. For example, someone can build a Facebook like application without central ownership and complete security. It is based on smart contract technology and allows developers who have proof of ownership of EOS coin to build upon it.
Let us again understand the main difference between Ethereum and EOS. A dapp developed on Ethereum will have to have its transactions verified by every single node before it is added to the blockchain, making it slow. EOS transactions are verified by distributed proof of stake. In other words, there are only a selected number of witnesses who approve transactions. The witnesses are voted and elected by the investors.
They are paid to verify transactions and are capable of approving millions per second. This is the most simplified explanation. There is more to it.
Another stark difference lies in the transaction fee. Unlike Ethereum, EOS transactions are free.
The distribution of this coin ended a year after it was launched. It can be purchased through the usual coin exchanges like Binance, Bitfinex, Huobi, etc. It can be purchased using Bitcoin or Ethereum. If you need to purchase it using US dollars, you will need to set up an account on an exchange like Coinbase.
This will allow you to buy Bitcoin and then use that to purchase EOS. While the EOS token itself may not have much value, possessing it allows you to develop dapps on the blockchain.
If it does live up to its hype of being massively scalable, it will have far ranging applications in the world of cryptocurrency. Developers are looking forward to the day they will be able to use it to perform parallel smart contract processing. Until then, it is worth keeping an eye on this low energy consuming blockchain to see how widely accepted its use cases will be.
New to crypto? Then read the ELI5 to blockchain and cryptocurrencies.