TL;DR

EOS is a layer-1 blockchain created to solve scalability problems of first and second generation blockchains. As the third oldest blockchain after Bitcoin and Ethereum, EOS has been used by developers to build blockchain applications and ecosystems. This, in turn, has unlocked use cases in the supply chain, decentralized finance (DeFi), and gaming finance (GameFi) sectors, among others.

Introduction

EOS was launched in 2018 using open source technology from Cayman Islands-based company B1. In its early days, EOS was known for outperforming other projects thanks to its technical innovations.

However, its development has slowed down and promises of venture capital for community projects, based on EOS, have not been fulfilled. Faced with these challenges, projects on EOS no longer had the necessary resources to continue operating on the network.

In solidarity, EOS Block Producers have reached a consensus on the creation of a new entity called the EOS Network Foundation (ENF), which is now responsible for the efficient capital management and advancement of EOS. EOS Block Producers also approved a proposal to stop locking tokens — or vesting — for use by B1, and the EOS Network became a decentralized autonomous organization (DAO).

On September 21, 2022, to achieve absolute code independence, community engineers led by ENF switched from EOSIO 2.0 to Leap 3.1, the C++ implementation of the new Antelope protocol. Today, with its new features, EOS continues to face scalability challenges like so many other blockchains.

What is EOS?

Token EOS

EOS uses the Delegated Proof of Stake (DPoS) consensus mechanism. Its native token, EOS, is a utility token used on the network to purchase system resources, participate in EOS governance, transfer values ​​in native network applications, and account for values ​​from investors and speculators.

Holders can also stake their idle EOS tokens and receive a percentage of the fees charged by users who wish to use the EOS system resources through the EOS PowerUp Model.

Introduction to the EOS blockchain

In many real-world situations, scalability is the most significant barrier to establishing public blockchains. Typically, the scalability problem in blockchains arises when a network grows and the volume of its transactions increases.

There is a lot of discussion about important parameters that measure the performance of blockchains, such as swaps per second, transaction throughput and latency, which in many blockchains have not yet reached a sufficient level of quality.

Through the capabilities of its ecosystem mentioned above, EOS aims to address these limitations without compromising network security or developer freedom.

Mecanismo WebAssembly C++

At the core of the EOS blockchain is a high-performance engine, WebAssembly (WASM), that executes the smart contract code. This engine was designed to meet the demands of blockchain applications, which require much more from a WASM engine than web browsers.

High throughput, faster commits and low latency

A good user experience requires low latency, with delays of no more than a few seconds. EOS achieves high transaction throughputs because its DPoS mechanism does not need to wait for all nodes to complete a transaction for it to be irreversible (transaction finality). This asynchronous style of validation results in faster commits and lower latency (less time required for a transaction to commit).

EVM Integration

EOS has an Ethereum-compatible virtual machine (EOS EVM) that allows Solidity developers on Ethereum to take advantage of the scalability and reliability of the EOS blockchain. This includes almost free transactions for its users, as well as access to the open-source libraries and tools they are already accustomed to.

Permissions through access keys

The EOS blockchain design incorporates a comprehensive and flexible permissions system to create custom permission models for various use cases. Account owners can grant specific permissions to third parties and have the power to revoke those permissions at any time.

EOS supports hierarchical account structures, which allow any user to manage multiple smart contracts through a single master account. Alternatively, an account owner can share the authority required to modify the smart contract with other accounts.

Flexibility

Thanks to the design of its protocol, applications deployed on EOS can be updated. That is, developers can deploy code fixes, add features, and change application logic as long as they have the necessary authority to do so.

EOS also allows developers to implement smart contracts that cannot be modified. These decisions are left to the discretion of the EOS developers, rather than at the mercy of the protocol.

Programmable resource allocation and governance

Developers can modify the system's smart contracts to create custom economic models and governance rules. The main layer of code does not always need to be updated for changes to occur, this on-chain mechanism can be modified using the system's smart contracts.

Or what makes EOS unique?

Human readable accounts

EOS uses human-readable accounts to make it easier for users to remember their own accounts as well as the accounts they interact with. Instead of long strings of random characters, EOS accounts often use addresses like “Alice.gm”.

Low transaction fees

EOS offers almost free transactions to its users, making it ideal for sending or receiving micropayments. This could remove one of Web3's biggest barriers to entry, as Gas fees on other blockchains can add significant costs to a single purchase.

Almost instantaneous finality

In the context of cryptocurrency transactions, the term finality refers to the assurance that transactions cannot be reversed or changed after completion. The speed of a blockchain affects its finality rate as it determines how quickly transactions are confirmed and finalized.

EOS takes approximately three minutes to complete a transaction — much faster than Bitcoin's 60 minutes and Ethereum's six minutes.

Compared to Web2, however, three minutes is still a long time to settle a transaction. Therefore, ENF and its key technology partners — a coalition known as Antelope — launched the Instant Finality initiative to provide users with instant, irreversible transaction settlement.

Energy efficiency

EOS's DPoS mechanism allows its nodes to validate transactions faster and with fewer network resources. As it does not involve mining as in Proof of Work (PoW) networks, EOS Network is one of the most energy efficient blockchains in the sector.

Base layer security

Recover+ (R+) is a cybersecurity portal and rapid incident response program. It was created to provide security for EOS DeFi projects, reward users who report bugs, and offer incentives for white-hats (ethical hackers). With the rapid response program, stolen funds can be quickly recovered in the event of a hacker attack.

On November 5, 2021, blockchain lending platform Pando Rings suffered a hack involving more than $70 million. Although Pando Rings is not an EOS-based application, the attacker stole more than $2 million in EOS tokens. The Recover+ team managed to intervene and freeze the stolen funds, thus protecting EOS DeFi users.

EOS Working Groups

Since ENF's creation in 2021, it has funded several EOS Working Groups for ecosystem improvements. She was also responsible for recommending actionable items through “Blue Papers,” which offer suggestions for improvements in various areas, including infrastructure, APIs, SDKs, DeFi, and security analysis tools.

EOS Network Ventures

EOS Network Ventures (ENV) is a $100 million venture capital fund whose mission is to attract investment and use it for the benefit of EOS Network. The fund also makes strategic investments based on equity and token balance in technology start-ups in the Web3 sector. ENV's scope includes — but is not limited to — GameFi, metaverse, eSports, NFTs, and fintechs.

EOS Network Foundation

EOS Network Foundation (ENF) is a community-run non-profit organization founded by Yves La Rose in September 2021. Its mission is to identify opportunities for investment, seed funding and collaboration towards the development and innovation of Web3 .

To this end, ENF coordinates public goods financing and non-financial support for the growth, development and global adoption of the EOS Network. Since its inception, several public goods programs have been organized and financed, contributing to the main developments of EOS.

On November 9, 2022, ENF announced a proposal to launch a US$100 million fund to be managed by ENV.

Final considerations

As the oldest blockchain after Bitcoin and Ethereum, EOS has overcome past challenges and adapted to current demands. It continues its move toward a robust system, using its performance, flexibility, and scalability to create Web3-native GameFi experiences for developers and end users.

Further reading

  • What is Layer-1 in Blockchain?

  • Proof of Work (PoW) vs. Proof of Stake (PoS)

  • What is Proof of Work (PoW)?

  • What is cryptocurrency mining?