With a grand and novel promise of creating a highly scalable platform to accommodate massive decentralized applications, EOS was able to find its way to the blockchain star-light. Raising over $4billion in its ICO, with its promise of giving more than what Ethereum provides. However, the journey from this baggage of promise to its actuality has been paved with lots of loop-holes been spotted on EOS.
Just in May of this year, the Chinese internet security company 360 spotted a vulnerability in its code from the testnet version; this weakness was capable of allowing the creation of more its tokens out of thin air, like conventional fiat money. EOS would have been a cryptocurrency with the possibility of being counterfeited.
Also, several vulnerabilities were spotted in the just-concluded “EOSHackathon contest.” And right in the midst of its launch, there are quite a lot of background controversies regarding the credibility of its voting system.
One of the features that gave it an edge in raising such massive amount in its ICO, among other factors, was its unique mining concept, which is, The Proof of Stake algorithm. This means a high degree of scalability, because of its speed and exclusion of transactional cost from ordinary users to a 5% room for inflation, which is a part of the mining protocol.
According to Dan Larimer, the CTO of the project, this system would act as a staking mechanism for Dapps, which requires massive cloud computational power for speedy execution of their smart contract’s idea. Also, in a bid to knock out the slow POW incentivization protocol, the POS protocol, charges the noble mining responsibility, that is Block Validation responsibility, to some selected members who are voted by the community, in place for this responsibility the system rewards them for this task, with a 5% annual sum.
Since the system is meant to provide computational and developmental facilities for businesses, its token serves as a stake for funding those Dapps that are hosted on its blockchain.
In addition, to its mining algorithm is the Transactions as Proof of Stake (TAPOS) algorithm, which mitigates the chances of a valid transaction been discarded by this delegated group of miners.
In view of its block production controversy, earlier stated, which is the election of a 21node miners voted by the community members, whose voting power is defined by the member’s stake in token on the network, out of the current EOS token in circulation.
Regarding this mining system, which by many is considered, somewhat contrary to what makes a blockchain unique in its applicative and functional sense, a block validator stands to earn a token worth of $2.5milllion on an annual average.
While this voting process would be repeated over and over again, this could create an unhealthy ambition for this validators to take unethical measures to remain block validators, which is totally opposite of what a decentralized trustless blockchain system stands for.