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ICO Analysis: EOS

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EOS.IO software by block.one wants to “Decentralize Everything”. Mr. Larimer has already put two notable blockchain systems live: BitShares and Steem. Both of these systems remain online and recently benefited from increased interest in the crypto-asset space in general. To this date, EOS has raised $200 million in revenue from token sales.

Brock Pierce, co-founder of block.one, told Reuters that EOS is designed to be a foundation for blockchain business applications. Attendees heard a lot about EOS at last month’s Consensus conference put on by Coin Desk. Block.one claims its platform has eliminated transaction fees and can process millions of transactions per second.

The startup, which recently started selling the EOS token to create a decentralized distribution of tokens to be used with the EOS.IO software has introduced the concept of automating business processes, monitoring assets, and creating multiple applications based on prior technology introduced by Mr. Larimer, who is the inventor of the “Proof of Stake” and the “Decentralized Autonomous Corporations” concepts.

According to its website,

(…) block.one provides end-to-end solutions to bring businesses onto the blockchain from strategic planning to product deployment.

The Team

Block.one CEO, Brendan Blumer, has been involved in the blockchain industry since 2014. Mr. Blumer’s businesses include virtual currency trading in MMORPGs in the US, okay.com in Hong Kong and 1Group in India.

Partner Brock Pierce has raised $200 million for companies he founded, according to his biography. A former child actor, the well-connected Pierce founded Internet Gaming Entertainment in 2001 and ZAM two years later.

Many of Pierce’s companies operate in the virtual currency space. Active in the Bitcoin blockchain ecosystem for nearly a decade already, and a former Director of the Bitcoin Foundation and founder and managing partner of fintech focused venture capital firm Blockchain Capital, Mr. Pierce mentors startup accelerators.

Pierce serves as a founder, board member or advisor at several bitcoin companies: GoCoin, Tether, ZenBox, Blade Financial, Expresscoin, Noble Markets, BitGo and ChangeTip.

Partner Ian Grigg is a financial cryptographer working on cryptographic ledger platforms for over 20 years. He is known for naming the Ricardian Contract, “a method to identify and describe issues of financial instruments as contracts”.

Mr. Grigg’s focuses have revolved around digital contracting. Ricardian Contracts “express all the salient details of an issuance as an unforgeable contract, unforgeably linked into every action within a payment system.”

The Ricardian white paper contract goes on: “By translating the institution of the contract into the digital domain, we build upon centuries’ and even millennia’s worth of experience in documenting, sharing and disputing the meaning of agreements between parties.”

The Ricardian Contract allows clarity in legal and customer support questions. “The user benefits from lower overall costs, and better presentation of information, within a more consistent framework.” Mr. Grigg’s work on triple-entry accounting incorporates Signed Receipt and standard, double entry bookkeeping.

Mr. Larimer is known for his work with BitShares and Steemit. He is credited with inventing delegated proof-of-stake and the concept of decentralized autonomous organizations. (modified by Ethereum)

BitShares’ market-pegged asset platform was described as a hedge against cryptocurrencies by placing fungible fiat derivatives backed by cryptocurrency on a blockchain. Larimer left the project due to lack of funding. In 2016 he joined Steemit, where he created a social content platform based on blockchain.

Larimer says BitShares’ innovation lays in its vertical scalability, which allows transactions to be processed up to as many as 100,000 per second. Mr. Blumer cites horizontal scalability, parallel execution of smart contracts and the simultaneous processing of transactions as EOS strengths. Block.one likely represents the most professional outfit with which Larimer has worked.

The Platform

The software is called ‘EOS.IO’. There is then the ‘EOS Token’ and the ‘EOS Platform’. EOS’ “asynchronous proof-of-stake blockchain” platform is designed to enable applications as user-friendly as centralized alternatives. Making use of delegated proof-of-stake (DPoS) consensus protocol, EOS describes its project as a republic wherein community members of the community delegate verifying transactions to elected block producers.”

Transaction as Proof of Stake (TaPoS) will be implemented on EOS.io software to require that each transaction includes the hash of a recent block header. This hash serves two purposes:

  1. prevents a replay of a transaction on forks that do not include the referenced block; and
  2. signals the network that a particular user and their stake are on a specific fork.

According to the EOS white paper: “Over time all users end up directly confirming the blockchain which makes it difficult to forge counterfeit chains as the counterfeit would not be able to migrate transactions from the legitimate chain.”

The EOS.io software ensures there are no gaps in its transaction history by assigning a sequence number to every message delivered to every account via “proof of completeness.”

The project’s white paper, available on GitHub, notes: “A user can use these sequence numbers to prove that all messages intended for a particular account have been processed and that they were processed in order.”

Integration

EOS, like many proposed distributed ledger platforms, intends to integrate various blockchain platforms. The startup intends on doing this by ensuring clients that they do not need to process all transactions.

After all, an exchange only cares about transfers in and out of the exchange and nothing more,” reads the white paper. “It would also be ideal if the exchange chain could utilize lightweight merkle proofs of deposit rather than having to trust its own block producers entirely. At the very least a chain’s block producers would like to maintain the smallest possible overhead when synchronizing with another blockchain.

In implementing Merkle Proofs for Light Client Validation (LCV), EOS hopes to enable “the generation of relatively light-weight proof of existence that can be validated by anyone tracking a relatively light-weight data set.”

The EOS white paper describes solving latency problems by breaking blocks into “cycles” divided into different threads and transactions containing messages for delivery. “This structure can be visualized as a tree where alternating layers are processed sequentially and in parallel,” according to the white paper.

It concludes:

The EOS.IO software is designed from experience with proven concepts and best practices, and represents fundamental advancements in blockchain technology. The software is part of a holistic blueprint for a globally scalable blockchain society in which decentralised applications can be easily deployed and governed.

“Every single account operates like its own chain, and supports interoperation between all other accounts without locking, so determinism is preserved,” according to Mr. Larimer.

Mr. Larimer calls EOS an “incremental improvement” over his previous projects, describing it as a “general case” of BitShares and Steemit. EOS could support applications like Bitshares and Steem, but it’d be up to those teams.

Our Rating

Now, whether or not EOS will offer infinite scalability and free transactions has yet to be seen – after all, there isn’t much code to go on. As for the latter claim, a basic foundation of pop-economics is that there is no free lunch. The question for EOS, then, and any blockchain project, is whether or not what it offers outflanks its predecessors and contemporaries.

Thanks to its experienced team, and its track record of success, as well as in-production use cases for the technology itself, we give EOS a 6.75 out of 10.

Investment Details

EOS digital token distribution opened up Monday, June 26. EOS’ token distribution follows a participation model that will transpire over the course of one year, “creating the fairest token distribution project on Ethereum to date,” according to the company. Pierce told Reuters that

The goal of the EOS token sale is to make it truly democratize and provide equal access to everyone (…)

Mr. Blumer said: “To ensure inclusivity, EOS

To ensure inclusivity, EOS are not sold for a fixed price, but sold at a price determined by market demand; this mimics mining, but does not offer unfair advantages to large purchasers.

The EOS token sale, which is set to take place over the span of nearly one-year on the Ethereum blockchain, will see 1 billion tokens allocated. 20 percent of the EOS tokens will be sold during the first days, with 70 percent split evenly into 350 consecutive 23-hour periods of 2 million EOS tokens per, beginning July 1. The 10 percent leftover, reserved for block.one, cannot be traded or transferred on the Ethereum network. According to Blumer, EOS will be priced on market demand.

The crowdsale has appeared in New York Times, Reuters and VICE and other noteworthy outlets, as well as hosted info sessions, sponsored events, given out free merch, and advertised on Time Squares jumbotron. Like so many blockchain-based token sales, EOS today is little more than a concept, a white paper, and new code.

Critics levy criticism at Larimer for having left his prior projects, but the developer was free to leave the projects on his whim. He has said publicly that building up the platforms to be self-sustaining was his goal on both platforms before handing over responsibilities. Faces of developers, even on the bitcoin blockchain, often change.

Criticism of DPoS paints it as a winner-take-all arrangement which results in ‘whales’ who can control the system. Some compare it to proof-of-work in bitcoin, where holders of more currency may act as an ‘elite’ in the system.

Bitcoin and Ethereum can be thought of as Delegated Proof of Work where miners elect mining pools, Mr. Larimer told Hacked.com. Less than a dozen mining pools control the vast majority of block production, but Delegated Proof of Stake ensures there are over 20 producers “mining pools” elected by the stake (“hash power”). Like proof-of-work anyone can produce blocks occasionally by voting for themselves. Steem has over 50 unique individuals who produce blocks every single day, more than Bitcoin or Ethereum.

Featured image from Shutterstock

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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5 stars on average, based on 1 rated postsJustin O'Connell is the founder of financial technology focused CryptographicAsset.com. Justin organized the launch of the largest Bitcoin ATM hardware and software provider in the world at the historical Hotel del Coronado in southern California. His works appear in the U.S.'s third largest weekly, the San Diego Reader, VICE and elsewhere.




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6 Comments

6 Comments

  1. godtrader

    July 5, 2017 at 5:48 pm

    Thanks, that was an interesting read. I managed to make some profit selling my first windows ICO tokens at $4.29. Its interesting where the price of EOS token will go in next days/weeks. Looks like its just speculative demand.

    • Justin OConnell

      July 7, 2017 at 5:26 pm

      Speculative demand will fuel many ICOs. There seems to be a misconception that tokens should have an inherent value. In my opinion, public blockchains themselves are where inherent value and utility can be found. Token sales are often a vote of confidence in the wherewithal of a specific project. In the case of EOS, it evokes confidence thanks to Mr. Larimer’s experience and the capital behind the project.

  2. choikech

    July 6, 2017 at 1:29 am

    EOS anaylsis published too late. The heat is already gone.

    • Justin OConnell

      July 7, 2017 at 5:27 pm

      It is likely that, at least, a finished platform will come of this considering Mr. Larimer’s coding experience. I would be surprised, in this case, if nothing came of this.

  3. AsTi

    July 6, 2017 at 8:17 am

    EOS ICO SCAM and you know it. 170 million to build the Bitshares fork? Really? Where this invested money? Definitely on the exchanges.

    BTW, almost every second post is ‘to late’ or has info like this.

    • Justin OConnell

      July 7, 2017 at 5:28 pm

      It’s likely, due to Mr. Larimer’s experience, a project will come of this. Further, the company’s partners are well-connected.

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Altcoins

Tron Price Analysis: Fundamentals are Stronger than Ever; TRX Bulls Staging Comeback

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  • Tron network has breached over 100 million transactions, as reported by Justin Sun.
  • Zero transaction fees are anticipated on the Tron ecosystem, by Friday 21st

TRX/USD has remained generally soft since the 29th November. The price has been cooling and ranging since its spike higher at the back end of November. TRX is remaining well supported within a near-term acting demand zone. This has been in action since 20th November, providing necessary comfort, to prevent a free-fall below the 1 cent mark.

Despite this described technical behavior, the fundamentals surrounding the Tron foundation remain very strong indeed, as the founder Justin Sun likes to keep the community up to date with all the latest via his Twitter feed. There seemingly being much promise surrounding Tron’s daily activity and transactions.

Tron Hit 100 Million Transactions

Sun, took to his Twitter account today, to announce that it had recorded 100 million transactions. He said, “TRON has reached 100 million transactions today.” Sun provided a screenshot of the Tron platform, which showed the number of transactions had in fact breached the 100 million mark.

100 million transactions

Over 2 Million Daily Transactions

Previously, he had boasted how the Tron network continues to breach records with its daily transactions, tecently having well and truly smashed through the 2 million mark. One community member, which Justin Sun retweeted, provided a comparison of Tron’s daily transactions, versus its peers: “TRON’s new record of 2,64 million daily transactions in comparison w/ the Top 5; 9.6 times more than Bitcoin’s 275k, 4.6 x Ethereum’s 567k, 4.1 x Ripple’s 633k, 188 x Tether’s 14k, and 264 x Stellar’s 10k.”

Zero Transaction Fees Coming Soon

Elsewhere, Justin Sun had posted something via the Tron community on his Twitter. This detailed, “The transaction fee of TRXMarket has dropped to 0.1% at 07:00(UTC) on Dec 14th! And 0 transaction fee will be realized by next Friday.” Given this, the ecosystem may see zero transaction fees by Friday 21st December.

Technical Review – TRX/USD

TRX/USD daily chart

Looking to the upside, should the bulls maintain this current course of momentum, TRX/USD could be in for decent gain. Firstly, resistance in a prior acting demand zone must be broken down for greater moves north. This can be seen tracking from $0.01600 up to $0.01800. As mentioned, this area had previously been supporting TRX/USD from August right up until November. Given the length of acting demand, it may prove a challenge breaking down.

TRX/BTC daily chart

Lastly, TRX/BTC is heading towards an extremely critical and game-changing zone. An area where the price faltered in August and October. As can be observed via the daily chart view, there appears to be some chunky sellers camped here. As a result, on each occasion, this region sent the price free-falling back down to the south. A clearance above will see a large renewed wave of buying pressure come back into play.

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.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 87 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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Altcoins

Litecoin Price Analysis: LTC/USD E­­­njoys Double-Digit Gains as Lightening Network Seen Imminent

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  • Litecoin has run higher by 20% over the past three sessions.
  • The community of Litecoin is very much excited about the upcoming activation of the Litecoin Lightening Network.

The Litecoin price is currently enjoying a bull run, running at its third consecutive session in the green. LTC/USD having gained a whopping 20% to the upside after producing another bottom area around the $22 territory.

Prior to this push higher being observed, LTC/USD had been moving within a tight range, after bottoming on 7th December. It initially appeared to be subject to another extended move to the downside, given the formed range-block.

Litecoin bulls still need to breakout from this mentioned formation. The low as detailed above is seen down at $22. The upper part of the range can be observed up within the $27 territory. To avoid another bear attack near-term, this must be breached.

Litecoin Lightning Network Imminent

Earlier this week, cryptocurrency exchange, CoinGate, did announce via witter that the Litecoin Lightning Network is now ready for its deployment. CoinGate also put itself up for hosting for the activation to take place on their platform. The exchange tweeted: “Litecoin community, we bear some exciting news! Our Litecoin LightningNetwork is ready to be deployed and will soon be live on CoinGate! Keep up with the news as we’re getting closer!”

The Litecoin founder, Charlie Lee, responded: “Even Litecoin will soon have more than 1000 merchants accepting LN payments! Thanks CoinGatecom!” Lee recently spoke about the Lightning Network, where he detailed how it is a second-layer solution for payments that go through Bitcoin and Litecoin.

Technical Review – LTC/USD

LTC/USD daily chart

As touched on earlier, the key for greater upside is to see a break out from the mentioned range-block. The bulls must storm through the $27 territory. However, not long after there is another barrier in the way. LTC/USD, between the 25th November and the 5th December, was in a prior range-block. The bottom for this was seen around $27 up to $29, which was a very short-term demand area. A push above this zone should pave way for a fast return back towards $50.

LTC/BTC Daily Chart Review

LTC/BTC daily chart

In the latest run to the upside for Litecoin, it has moved to its highest levels seen since 1st December. There is a key near-term barrier being eyed around current levels. A descending trend line running from the start of August is observed. The bulls must force a daily close above this resistance to see a further wave of buying pressure.

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.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 87 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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Analysis

XRP/USD Price Analysis: Israel’s Largest Financial Services Company GMT Partnering with Ripple

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  • Ripple has another large financial firm leveraging its technology, as the list keeps on growing.
  • XRP/USD will search for buyers within $0.3000-$0.2500 range initially, ahead of possible $0.2000 return.
  • XRP/BTC looks surprisingly encouraging, subject to a potential breakout to the upside.

XRP in line with the rest of its peers across the cryptocurrency market remains firmly on the back foot. XRP/USD is running at its third consecutive session of losses. At the time of writing, the pair has dropped 7% over this mentioned period. A renewed wave of selling pressure hit the market after the price was allowed some time to consolidate. The market was very much within range-bound mode, before the bears struck again. As a result, XRP has firmly given up the $0.3000 mark.

Israel’s GMT to Utilize Ripple Technology

The largest financial services organization in Israel, GMT, has announced a partnership with Ripple. They will be utilizing Ripple’s technology for their cross-boarder payments.

GMT said via their latest blog update: “GMT is joining companies like MoneyGram, AmericanExpress, CIBC, Earthport, AKBANK and many more, who are already authorized to use Ripple’s platform. This partnership is establishing GMT’s place in the forefront of the Israeli Fintech industry, also allowing us to work side by side with some of the leading companies in the world.”

GMT are the largest and leading financial services organization in Israel. They have an outreach of  250 branches spanning across the country. GMT specialize in local and international remittance services, among many other financial offerings.

In terms of which technology of Ripple’s they will exactly be leveraging, it does not appear to have been stated for now. Whether GMT will be using either xCurrent or xRapid is still subject to debate. Hacked will be sure to provide further details upon those being announced.

Technical Review – XRP/USD

XRP/USD 4-hour chart

Price behavior seems to be quite readable of late. XRP/USD is going through periods of hard selling, which is then followed by some range-bound trading. Once again, bears breakout from this consolidation mode to ignite more downside pressure. Between the 7th and 14th December, XRP/USD had formed a range-block. The sellers came piling in on the 14th December, and as a result the recent range was broken with $0.3000 giving way.

XRP/USD weekly chart

XRP/USD is now moving within a critical area. This is seen running from $0.3000 to $0.2500.  A very well-known area for big buyers coming in, as proven on occasions this year. Any failure of this initial range holding could see a free-fall down to $0.2000.

XRP/BTC daily chart

Finally, looking the daily chart of XRP/BTC, it remains somewhat encouraging. XRP is holding its ground again BTC, in comparison to many of its peers. The price is ranging for now, looking possible to see a chunky breakout to the upside. It remains trading around levels seen during the explosive run in December 2017.

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.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 87 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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