What is EOS?
EOS claims to be many things in one- account creation, authentication, databases, asynchronous communication and decentralized running of applications. In short, EOS may work like a decentralized operating system, sourcing computer power from a decentralized network.
- EOS Technical White Paper
- Country of origin:
- Ticker: EOS
- ICO Dates: Rolling, Current Round Ended Oct 28, 2017
- Hard Cap: None, up to 1,000,000,000 EOS
- Funds raised: Latest Round, 1,380 ETH for 2,000,000 EOS
- ICO Period: 350 days, rolling sales
- Industry: Blockchain Infrastructure, decentralized apps, decentralized data
- Funds accepted: Ethereum
- My Rating: 3/5
EOS Social Media
EOS is the brain child of Dan Larimer, a rather famous developer in the cryptocurrency community, pronounced a visionary. He also gave start to the BitShares system featuring a decentralized exchange, as well as Steemit, a social media platform based on the Steem token.
But what is EOS, as a project? EOS aims to offer a medium resembling an operating system, where distributed apps can be built. The resulting system promises to run one day as a fast, zero-fee decentralized system, with a high transaction capacity. And this claim is rather ambitious, given that currently, even the fast blockchains are seeing clogged traffic. EOS has tested the highest capacity of transactions on specialized machines, but no one knows if this would translate into high speed once the system has to go through the routing process of a standard internet infrastructure. Currently, BitShares gives a glimpse of how such a system would work- it is working, although somewhat slower than traditional centralized software.
The software, built by an offshore company, block.one, has not been released yet- but this has not stopped the bidding for tokens.
EOS went through a series of ICOs, and is currently in a stage where funds are distributed based on daily bidding. There is no pre-determined price at those small-scale ICOs, and instead each sale represents an ETH-EOS bidding. The current market price of EOS is $0.53, and in the past few months has moved down from above $1.50. The current bidding round places the token sale price roughly in line with the market price, as Ethereum traded around $296 and one ETH bought around 1,500 EOS.
Right after the first ICO, EOS distributed 700 million tokens, and 200 million at a later date. Since then, the price has been depressed, never recovering to the $4.50 peak.
The EOS Team
The EOS team is an unnamed entity distributed around the world. The GitHub page for the project shows 42 contributors, headed by Dan Larimer, going as “Bytemaster”. Strangely, the contributions for some of the top developers, nathanhourt, brianjohnson5972 and elmato seem to peter out in September, as measured by the number of commits of new code. Either EOS is almost done, or has hit a roadblock- there is no way to know how the project would go on.
But certainly, Dan Larimer has stolen the spotlight of this team, especially by running the Steemit platform rather successfully, and by presenting an appealing public image as a “visionary developer”.
In September, Dawn 1.0, an open source smart contract platform, had a release, but so far only a skilled developer would be able to make heads or tails of the product- it is not for the ordinary user.
About EOS Token
The EOS token is quite standard- an ERC-20 token based on the Ethereum network. This means it has a convenient web-based wallet to be held in, MyEtherWallet. EOS is also available with the later versions of the Exodus wallet, a user-friendly application that has a portfolio-like layout. The wallet itself has a built-in exchange for relatively small sums, and EOS can be easily sampled by swapping it for another asset in the wallet.
In total, there will be 1 billion (1,000,000,000) EOS tokens available. In the first two ICO events, 900 million were sold, in the summer of 2017. Another 100 million tokens are in storage for the developers' fund. This leaves a bit below 500 million EOS tokens still unsold.
The EOS tokens are sold with a formula in mind, only determining the price after the amount of Ethereum is gathered for the period. The token distribution generates a feeling of scarcity and missing out- so it is easy to rush and send Ethereum. But no one knows how each sale would play out, and if the current market prices would be at a premium or the new tokens would be above market values.
Video: Something strange is happening with EOS – Programmer explains
Update: The video has been removed…even stranger! Just left the blank video up for historical reference.
Investing in EOS: The Pros
Investing in EOS is logical if you like the running of Steemit and BitShares. But if you find those projects mystifying, and targeted only to those who understand blockchain deeply, they would not appeal to you. EOS is a prominent and actively traded token with enough price fixing information.
As we already mentioned, it is easy to sample EOS with the Exodus wallet, observing the growth- or drop in your portfolio.
You may invest in EOS if you believe Dan Larimer is doing something revolutionary. With less than six months from the ICO, the product is still in the making, and it may affect the token price positively.
The Risk of EOS
Owning EOS tokens right now would expose you to many risks.
First, if you buy through a token distribution event, you will face the risk of an unknown price, revealed only after the ETH for the day are summed up and the 2 million EOS are divided among the contributors.
Secondly, EOS is traded on exchanges with an experimental approach and low volumes. It is mostly traded against Bitcoin or Ethereum, meaning it cannot be bought for cash, and it cannot receive an influx of funds from new investors. Rather, EOS tokens may fall to speculation by Bitcoin or Ethereum whales.
EOS does not trade on Bittrex or Poloniex, thus excluding the usual profile of the US-based crypto investor. It has a limited presence on the Kraken platform targeted to Europeans, and EOS is also available on Kucoin and Binance, novel and experimental exchanges. So for now, do not expect a major mainstream interest in EOS.
Video: Is EOS a scam are the conspiracy theories true?
Final Thoughts on EOS
Many have called EOS a scam. Some believe there is actually no novel code, just a re-rendering of BitShares, even as the usage of BitShares has proven that the project did not manage to change the world. Users have found striking similarities between BitShares and EOS commits. Now, there may always be an evolution for EOS, but time will tell if they deploy a radically different product.
Other criticisms include a uncapped ICO for distributing the tokens. Some believe this allows founders, who also hold a lot of Bitcoin and Ethereum, to pour them into the company and receive tokens- thus, in essence, controlling both the Bitcoin and the newly issued tokens that also command a good market price.
The market price of EOS also seems like a risky bet, with a long slide and new tokens potentially hitting the markets every day. So while EOS can be tested with a sum that the investor can afford to lose entirely, it is definitely not a token sale to bet large sums on. It is best to stay away from the token event and its auction-like risk, as it is buying “blindly” into EOS, and users may underbid or overbid one day.
As of October 28, the price of the EOS token for those sending Ethereum was around $0.33, lower than the market price. But since any amount of ETH can move in before the close of the sale, the final amount of tokens received would be unknown. If you still insist on trying your luck with EOS, there is a tool to watch the most recent sale and estimate the approximate price. The tracking tools may not be accurate and display different ETH amounts due to blockchain congestion.
Should YOU Invest?
Honestly, most people looking to invest in altcoins, tokens, and ICOs are hoping they discover the next Bitcoin or Ethereum. The chances of that are rare.
So where is your money best invested? My recommendation might surprise you. It's free to join, and won't require that you invest in risky cryptos!