When Bitcoin was first introduced in 2009, it was nothing more than just an alternative to transactions and a reward for mining. In fact, cryptocurrencies are just Bitcoin was only utilized for peer-to-peer transactions and it didn’t extend to any other users besides that. However, change came into the market will Ethereum introduce its cryptocurrency the utilizes the concept of smart contracts. Using smart contracts, this enables the automation of agreements within the blockchain based on certain preconditions.
Meanwhile, Bitcoin doesn’t have been blockchain technology in which decentralized applications can be developed. We should be thankful for the creation of Ethereum because they have enabled the next wave of applications to enter the market. However, Ethereum may need a strong contender in their industry because EOS wants to challenge their reputation as a decentralized platform builder. Let’s take a look at what EOS has to offer.
If we compare EOS to any other cryptocurrencies out there, EOS offers a solid platform which is needed for any developer to build decentralized applications. Moreover, EOS also allows developers to utilize programming languages which are in use in the real world for web development. This will decrease the level of entry barrier for developers that want to put forth their idea for blockchain applications. Also, EOS also our first the web Toolkit which will make developing much easier.
To make things simpler, EOS works a lot like the Google Play Store. At the moment, the native cryptocurrency of EOS will not be associated with the usage of the EOS blockchain. Meanwhile, the governing body of the blockchain network is EOS.IO.
Can EOS beat Ethereum?
If looking at it at first glance, EOS may seem like it is highly similar to Ethereum because it facilitates the development of applications that enable decentralization. However, if you look deeper into each of these platforms, we will see flaws in Ethereum. EOS wants to solve the problem of the Ethereum platform by improving the scalability and flexibility of the decentralized platform. Hence, EOS believes that it can execute thousands of decentralized commercial applications at the same time. This is mainly because EOS claims that it can scale from its inception.
So, should you buy EOS?
For the EOS cryptocurrency, the token value of the market into account the transaction costs. Meanwhile, dealing with Ethereum is that users will be exposed to the risk of a fluctuating price. In terms of speed, EOS present a higher level of speed compared to Ethereum. Although so, Ethereum is a popular platform that people are accustomed to and it will take a lot of convincing the for developers to move to the EOS platform.
However, one of the potential things that will make developers switch from the Ethereum platform is the fact that developers have to pay a certain fee to use Ethereum. However, this is completely different using EOS because there are no transaction fees on the platform. EOS also is more reliable as it has zero delays. While Ethereum is great for small-scale applications, EOS is reportedly able to work with the industrial scale of applications.
On top of that, let’s take a look at several other reasons why EOS can dominate the cryptocurrency market.
Highly capitalized startup
One of the main reasons why EOS has gained mainstream awareness is the fact that it has a highly practical usage. As a result, this has turned ahead of corporations, and venture capitals that want to invest in the growth of this startup. One of the companies which are vying for the growth of EOS isOK Blockchain Capital. They have recently invested a hundred million dollars for projects that will be developed on the EOS platforms. This is great news for developers that want to join the EOS platform as they have a chance of gaining funding for their projects.
OK, Blockchain Capital decided to invest in EOS because they believe in the capability of the platform to go far. In fact, this is their very first partnership in the blockchain ecosystem with another company. Therefore, OK Blockchain Capital has also committed to supporting the expansion strategy that EOS will release. Among the international expansion strategy that EOS has released includes possible expansions to the United States, Singapore, and Switzerland. The hundred million dollars also be targeted at promoting the increased circulation of EOS tokens around the world and attracting my developers into the platform.
The news of the partnership between these two companies has caused an increase in valuation of the EOS tokens. EOS decision to expand into South Korea might be a great addition because China is still not a viable market for now. However, there seems to be a glimmer of hope that the cryptocurrency situation in China will improve in the next few years as the newest governor of the country’s central bank is pro-market.
German fintech incubator FinLab AG has also announced a $100 million joint venture in pursuit of developing products which can help them utilize the EOS software. Through this partnership, they hope that it will be able to increase awareness of the EOS platform. Other venture capitalists combined with all of these funds coming in means that the company has a total of $1 billion worth of funding. If you think that is a lot of money, that is only a fraction of the seed capital that goes into EOS. IO.
Proof of stake vs. proof of work
If you are trying to make sense of the decision of choosing EOS over Ethereum, you should consider the fact that EOS utilizes the proof of stake protocol meanwhile Ethereum uses proof of work protocol. Ethereum utilizes the same protocol as Bitcoin which is a highly energy-intensive method of mining cryptocurrencies. Besides, there is a difference in the way that consensus is made between this two systems. Hence, we will try to explain to you the difference between proof of stake and proof of work.
Under the proof of work system, this can be deemed as a maths competition where competitors get to solve maths problems but using their computing power. Anyone who manages to solve the mathematical problems first will be rewarded with the cryptocurrency that they are mining. This money will be sent directly to the wallet of a miner. The first miner that manages to solve the block is required to provide the proof of his solution, and it is posted for everyone involved to see.
The whole infrastructure built by mining cryptocurrencies enables the cryptocurrencies market to exist without the existence of centralized institutions such as banks. Therefore, these miners help to maintain the transactions within the system through their computing power. However, keep in mind that they don’t have access to the details of each block because there are only required to complete the mathematical problems and maintain the system. This is mainly because the transactions are done are encrypted.
Then, comes the problem with proof of work. Ethereum is a cryptocurrency which utilizes a proof of work. One of the possibilities of concern with proof of work protocol is the security aspect. In fact, this is my cost the possibility of a mining attack in which the attacker will choose to reveal the mine blocks to waive any computational processing resources. It is possible that an attacker can launch an attack on small blockchains to affect the ecosystem.
With the proof of stake protocol, every miner for once to solve the mathematical algorithm within the system users and a different method of solving it. Yes, it still depends on who solves the question first, but it will also take into account which invested more money into the competition. If you think about it, this is a lot like buying lottery. You might win, but it will be dependent on the amount of money spent on the ticket. It also takes into account how long you have been in the ecosystem. the Therefore, the size of the stake that you have in EOS plays a huge role. On top of that, proof of stake is also reportedly more secure compared to proof of work protocol is because it can withstand more attacks compare to proof of work.
However, the major problem lies ahead for proof of stake because it can be difficult to achieve consensus as forgers don’t have to lose anything if they don’t vote. Another potential problem is the fact that you can only own coins by buying off someone it already owns them. Therefore, as no new coins are being mined, the tokens of my will most probably be controlled by someone has a large amount of the tokens, and they can manipulate the prices.
A brighter future lies ahead for EOS
At the moment, EOS blockchain infrastructure is supported by the Ethereum standard tokens. As a developer, EOS is working very hard to release developments for their software. In fact, the team is highly excited to announce that they are way ahead of their scheduled developments. At the moment, this software will enable users to utilize horizontal and vertical scaling for decentralized applications. EOS distinguishes itself from any other blockchain platform is by defining himself as a where infrastructure instead of an operating system.
In fact, this is a software which provides accounts, databases, authentication, as synchronous communication and the ability to schedule tasks across hundreds of CPUs. With the integration of all these features, it allows for millions of transactions local within the blockchain. The company itself primarily identifies itself as a tech provider that wants to offer an alternative platform to Ethereum. Of course, there are criticisms of the possibility of toppling the dominance of Ethereum in the cryptocurrency space, especially because they have a great network effect. For once, Ethereum may finally meet a real rival in the cryptocurrency space.
Wrapping it up
If you want to look at EOS and Ethereum, it is important that you take into account the usability of the platform. So far, EOS seems to present itself as a solution to all the flaws that Ethereum have and can potentially be a great contender in the cryptocurrency market.