EOS Price Remains Under Pressure Following Damning Report on Malicious Bots
EOS’ price has been trending lower for the past week, coinciding with a broad market downturn and a damning report showing that most decentralized application (dapp) activity is being driven by malicious bots.
EOS Price Update
The EOS price continued to slide on Tuesday, falling 2.5% to $6.25, according to CoinMarketCap. Since peaking at $8.59 on June 1, EOS has dropped nearly 28%. Over the same stretch, the overall cryptocurrency market has shed around 8%.
By falling more than its large-cap peers, EOS has seen its market cap ranking drop to sixth spot. At $5.7 billion, the Enterprise Operating System is worth less than bitcoin cash ($6.8 billion) and Litecoin ($7.9 billion).
The cryptocurrency’s reported trade volumes were roughly $2 billion on Tuesday. The top exchanges are ZBG, Digifinex and Fcoin, according to Weiss Ratings. EOS/USDT transactions account for more than half (56.9%) of the trading volumes.
Dapps Driven by Bots, Report Finds
The sharp drop-off in EOS’ price coincided with the release of a new study by blockchain hacker group AnChain.AI, which showed that the vast majority of dapp activity was driven by malicious bots.
The study, which analyzes dapp activity in the first quarter of 2019, found that a whopping 75% of total transactions on decentralized applications were from non-human accounts. More than half (51%) of new accounts were said to be created by bots.
AnChain.AI analysts focused on the top ten EOS blockchain dapps, which account for 65% of all transaction volume. From there, the hacker group was able to identify repetitive accounts that were deemed to be malicious bots.
While EOS’ performance cannot be tied directly to the report, the blockchain industry could face a crisis of legitimacy over inflated metrics caused by bots. With bots being so prevalent, the industry may need to adopt new measures to analyze the success of decentralized applications. Presently, ‘success’ and ‘failure’ is tied to perceptions about user adoption, which means growth metrics such as transaction volume.
As AnChain.AI rightfully noted, bots are by no means unique to the blockchain ecosystem. By 2018, nearly 40% of all internet traffic was driven by bots.
In terms of volume and users, dapp activity is dominated by just three blockchains: Tron, EOS and Ethereum. As of Tuesday, EOS accounted for three of the top-ten most active dapps, according to dappradar.com.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock. Chart via CoinMarketCap.