What is EOS Crypto? Learn More About EOS Crypto

Brandie E Blackler
9 Min read

Ethereum was 'the' cryptocurrency back in the day when the topics of dApps came up in various discussions. However, in 2017, there came along the EOS crypto, offering features potentially more advanced than Ethereum.  

Interesting fact - some even dubbed EOS the “Ethereum Killer”. Naturally, this nickname is extreme. With a fee-free blockchain ecosystem, the integration of dPoS, along with other interesting claims - Could the EOS crypto be the next leader?

As you imagine, only time can tell. Let us take a closer look at what EOS Crypto is and what it offers in this article. 

Introduction: What is EOS Crypto? 

EOS stands for Electro-optical System. It is an open-source blockchain platform designed for the hosting, creation, and development of decentralized applications or dApps.

Technically, the platform is called EOS.IO while the cryptocurrency native to the platform is called EOS. This platform and its currency were introduced in 2017 by a company called Block.one.

The company was headed by Dan Larimer and Brendan Blumer. Dan had designed the cryptocurrency exchange Bitshares before he developed EOS. 

The idea behind introducing EOS has been detailed in its whitepaper. The goal was to make the platform more scalable through the ability to process (in theory) a million transactions per second.

This was far greater than Ethereum’s capacity. It was also intended to make the platform affordable to use, which meant zero fees vs Ethereum’s “gas fees”.

The third motivation was to make the platform’s smart contracts more open to developers by adding support for languages like C++. Lastly, EOS worked on the concept of delegated proof-of-stake (DPoS) vs proof-of-work (PoW) consensus mechanism used by the likes of Ethereum. 

If you would like to trade the EOS CFD at Admirals, you can start with a demo trading account which allows you to use virtual funds:

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What is EOS Cryptocurrency? 

The EOS cryptocurrency was introduced via an ICO back in 2017. It was one of the largest ICOs in history with Block.one selling 1 billion tokens to raise $4 billion.

EOS is not just a medium of exchange, but also a voting right. The delegated proof-of-stake (DPoS) concept of the EOS.IO platform means that every EOS is like a share.

EOS holders, in proportion to their holdings, have voting rights to elect block producers. These producers have the responsibility for producing blocks and validating transactions on the EOS.IO network. 

EOS has become popular because of its role in offering a high-performance platform that can foster the development and growth of dApps. EOS tokens are not created by mining. Rather, the network’s producers get paid in EOS tokens once they validate transactions.

The producers are, interestingly, free to demand whatever payment they feel is needed. However, the total number of tokens in the network cannot increase by more than 5% annually.

Additionally, due to the democratic nature of the DPoS concept, voters can take action if they believe that a producer is demanding too much payment. 

EOS can be traded on multiple exchanges. They are stored in digital wallets like other cryptocurrencies. If you’d like to learn more about general trading and how to trade, make sure you register for one of our upcoming webinars: 

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What are the Use Cases of EOS? 

The most obvious answer that a trader or investor will be looking for is speculation. You can buy and hold or trade EOS CFDs in both long and short directions (Buy or Sell). However, there is more to EOS than just that. 

The EOS.IO platform can be used to create decentralized apps in several industries. It is designed to make it easy for businesses and individuals to dApps similar to web applications.

Firstly, one could make an app to track the movement of cargo and other shipments to bring transparency and accountability. So, there are supply chain solutions that EOS can offer. 

Secondly, EOS.IO’s democratic bent could be put to good use in an important democratic exercise - voting. The EOS blockchain platform can be used to ensure fair elections via a secure and transparent online voting system. 

Thirdly, EOS can be used to verify the identity of a person and store it securely. This process can be used to activate accounts, disburse loans, and perform a range of online activities. 

Fourthly, one can use the EOS tokens to make payments to merchants who are willing to accept them as a form of payment. You can make online purchases using EOS. You can also use EOS to send payments abroad or receive them from around the world. You have to, however, follow relevant rules and regulations established by your local government. 

Lastly, you can use EOS tokens to become a voting member of the EOS.IO network. If you are passionate about shaping the way the EOS.IO network evolves and how it is governed, then EOS tokens are a potential option. 

We show you below the daily price fluctuations of the EOS against USD via the TradingView widget: 

* Past performance is not a reliable indicator of future results or future performance. 

How is EOS Different from Ethereum? 

Transaction Capacity: Ethereum is limited to performing 15 transactions per second. EOS.IO is designed to process 1 million transactions per second, at least in theory. It is known to perform thousands of transactions per second and hence, appears to be much more scalable than Ethereum. On the contrary, Ethereum is a much more well-known blockchain. 

The Consensus Mechanism: As outlined above, Ethereum works on a proof-of-work mechanism that involves miners using vast computing power to perform complex mathematical calculations. EOS.IO works on a delegated proof-of-stake mechanism that involves electing block producers to validate transactions. Both are valid and dependent on what purpose and result is required. 

Security: The Ethereum network has, in the past, been subject to DAO attacks. EOS.IO aims to plug this security gap by having the ability to halt a node affected by such DAO transactions. The network resumes processing transactions only when the issue is resolved. This point is a general improvement, however, Ethereum has existed much longer. 

Fees: As mentioned previously, EOS.IO does not charge a fee to execute smart contracts. Ethereum charges something known as “gas fees” which can be costly. Based on all overall factors, it depends on the end result of the transaction to determine which option is viable. 

Advantages and Disadvantages of EOS Crypto 

EOS has certain important advantages over comparable cryptocurrencies. First is its ability to process a large number of transactions per second. That makes it a more practical option for digital payments. 

Secondly, EOS is fee-free. So, it is cheap to use for transacting. However, you have to stake or block some tokens to be able to use the EOS network. 

EOS has faced criticism for being too centralized. As the dPoS model works on voting, there is a chance that one entity can acquire a significant number of EOS tokens and hence voting power. 

There is a rate limit disadvantage for smaller investors. If the EOS network reaches capacity, then it limits transactions. Low EOS balance accounts tend to get affected as they are unable to execute transactions in such a scenario. 

EOS Crypto: Conclusion 

EOS and its platform EOS.IO bring in interesting concepts of dPoS, scalability, and a fee-free model. It seems to have utility not just as a payment method, but also as a platform for dApps.  

While it hasn’t exactly taken over Ethereum completely, EOS.IO has been making the news lately after going quiet since its record ICO.

More recently, Binance announced that it had completed the integration of Tether to the EOS network. There could be a significant number of transactions on the EOS network in the future. 

You can trade the EOS CFD in both directions (long or short) on the MetaTrader 5 trading platform with an Admirals account; we only offer cryptocurrency CFDs and not the underlying asset or actual crypto coin.

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INFORMATION ABOUT ANALYTICAL MATERIALS: 

The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter “Analysis”) published on the websites of Admiral Markets investment firms operating under the Admiral Markets and Admirals trademarks (hereinafter “Admirals”). Before making any investment decisions please pay close attention to the following: 

1. This is a marketing communication. The content is published for informative purposes only and is in no way to be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research. 

2. Any investment decision is made by each client alone whereas Admirals shall not be responsible for any loss or damage arising from any such decision, whether or not based on the content. 

3. With view to protecting the interests of our clients and the objectivity of the Analysis, Admirals has established relevant internal procedures for prevention and management of conflicts of interest. 

4. The Analysis is prepared by an independent analyst (hereinafter “Author”) based on Brandie E Blackler, Financial Analyst and Writer, personal estimations. 

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