Category Archives: EOS

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Tether’s Rivals Continue to Gain Stablecoin Ground

The emergence of stablecoins continues to provide a glimpse of hope to cryptocurrency investors despite the market’s steep decline since its all-time high in 2017.

However, not too long ago, this confidence began to shift away from Tether (USDT) – the largest stablecoin by capitalization, to others such as Huobi (HUSD), USD Coin (USDC), True USD (TUSD), Paxos Standard Token (PAX), and Gemini Dollar (GUSD). Many of those in the list have seen rising premiums against USDT in recent months.

In a recent stablecoin conference organized by BECON, which was held in New York on Monday, General Counsel of Huobi’s Global Institutional Joshua Goodbody discussed the important roles stablecoins play in the crypto-market affairs. In his opinion, they serve as bridges between the fiat world and the world of cryptocurrencies.

Since its launch, one of Tether’s rivals, HUSD, has proven to be popular among users, says Goodbody.

Stablecoins are perceived to mimic the qualities of real-world fiat properties. Therefore, they establish a baseline of trust for investors, and traders of cryptocurrencies to hedge. This was the objective in mind when Huobi proposed its stablecoin in late October as a complementary solution to help make investment decisions among multiple stablecoins and save costs when trading stablecoins.

Goodbody during the conference made it clear that they “believe the recent developments of stablecoins are positive for the industry and Huobi decided to support these developments proactively by launching HUSD”. The Stablecoin HUSD integrates the properties of four other major stablecoins to include PAX, TUSD, USDC, and GUSD.

As an aggregator of stablecoins, the HUSD interfaces between any of the four supported stablecoins and gives traders the flexibility of switching to any of them on a 1:1 ration at any point in time. Goodbody said that they “provide the ability to deposit any of the four supported coins as HUSD and receive a 1:1 balance of HUSD”. Further, these stablecoins can also be traded with six other cryptocurrency pairs on the Huobi exchange. These include BTC, USDT, ETH, and EOS.

HUSD is not a particular token or coin on the blockchain, but a mere service being offered by Huobi Global. The way the product works is that, when any stable coin is deposited into a user’s account with the exchange, they are registered as HUSD balances. This gives a pseudo-interoperability between the four stable coins currently being supported. As described by the exchange when the balance on a stablecoin type is low, users can simply withdraw with another with sufficient balance.

In other news, Coinbase decided to launch an over-the-counter (OTC) trading desk earlier this month for institutional investors and in an interview, USDC is described as “one of the most liquid stablecoins” on the market to help stem volatility.

To a large extent, stablecoins play an important role in stabilizing the market. So far, the stablecoin markets have provided a safety net-like effect for investors and traders whose portfolios are being devalued by the current market crash, thereby acting as a soothing balm to the hysteria in the cryptocurrency ecosystem.

 

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New Report Cites Multiple Causes for ICO Funding Slump in Q3

In a new report by ICORating, ICO funding succumbed to a significant nosedive in Q3, dropping to 48% of its Q2 levels in 2018.

ICORating specializes in evaluating companies with a planned ICO. Their analysis is described by the company as being thorough and objective, reviewing companies as potential investment objects. The report revealed that in Q3 of the 2018 fiscal year that only 4 percent of ICOs managed to get listed on cryptocurrency exchanges, and more than half of the ICO projects declared that they managed to raise just USD 100,000.

Compared to Q1 and Q2 this year which saw Telegram and EOS raise over a USD 1 billion, this last quarter trailed with only one really significant fundraiser raising big numbers, – which reached USD 70 million. However, The London Football Exchange (LFE) did manage to feature in this year’s top 10 fundraisers’ list within the first 3 quarters.

LFE launched a cryptocurrency to power an ecosystem of “inter-related components” made up of sports, media, entertainment, finance and a foundation earlier this year, allowing “fan-driven” football community the opportunity to take part in various club and fan experiences.

According to the ICORating analysis, there were many reasons for the poor performance in Q3; overall, was that traditional ICOs were showing little promise as the year was drawing to a close. One peculiar reason cited was an increasing lack of transparency from ICO teams which tended to make investors wary.

Regulation has long been an issue and is only beginning to receive the attention it needs this year from jurisdictions in order to boost investor confidence in the aftermath of various scams and ICO frauds. This was cited as a significant investment determiner as potential investors become more knowledgeable and careful before making financial decisions.

The ICORating report also cited “an overall market downtrend, lack of new ideas from project teams and the not-so-fast pace of actual blockchain implementation in the traditional market,” as responsible factors in the current funding slumps in ICO investments.

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EOS21 Protocol Teleports Ethereum Tokens to EOS Blockchain

A new protocol called EOS21 has been developed, with the purpose of teleporting Ethereum ERC-20 tokens to the EOS blockchain. This will give decentralized application (Dapp) developers flexibility to use their native tokens on both the Ethereum and EOS blockchains, instead of launching a different token on each blockchain.

Transferring tokens between the Ethereum and EOS blockchains was possible even before the development of EOS21. Indeed, the EOS token itself was transported from Ethereum. However, this process is not automated and continuous; developers take a snapshot of the tokens on the Ethereum blockchain and open up an airdrop on the EOS blockchain. This is a one-shot deal where the ERC-20 Ethereum token version of the crypto gets burned and becomes non-functional. With EOS21, the token can exist on both EOS and Ethereum, and be moved back and forth as needed.

The EOS 21 protocol has three dimensions. In the first, a blackhole smart contract on the Ethereum blockchain absorbs ERC-20 tokens, while collecting EOS account information from the user. Developers can choose to burn their ERC-20 tokens in the blackhole or hold them in the smart contract. Therefore, developers can decide whether they are moving permanently from Ethereum to EOS or leave the door open to move the tokens from EOS back to Ethereum in the future.

In the second dimension, an off-chain oracle program watches the Ethereum transactions and authorizes the distribution of the EOS tokens. This oracle could potentially run entirely on EOS in the future instead of being off-chain. The third dimension is a smart contract on EOS that distributes the EOS tokens to the user.

Before EOS21, there was no direct link between the Ethereum and EOS blockchains. The linking of the Ethereum and EOS economies can be mutually beneficial. Now developers can launch Dapps on both the EOS and Ethereum blockchains and use the same token, expanding Dapp functionality, increasing user base, and providing upward pressure on a token’s price.

Further, distributing Dapps across Ethereum and EOS, rather than running on just one of those blockchains, can be considered a scalability solution. If the network gets congested on one of the blockchains, then users would use the other blockchain more to save on transaction fees, which would result in a lessening of network congestion on the 1st blockchain.

 

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Study: Ethereum ICOs Have Cashed Out as Much as They Raised

A report published by BitMEX on Monday shows that blockchain startups hosting initial coin offerings (ICOs) and raising funds in Ether (ETH) have now cashed out just USD 11 million short of what was raised.

The research indicates that the 222 startups that were tracked managed to raise USD 5,463 million or around ETH 15 million via ICOs by September 2018, while USD 5,452 million was sold in the same period. The projects are said to still hold ETH 3.8 million – a quarter of the number of tokens originally raised.

Despite a rocky year for ETH, the data indicates that most of the startups managed to sell at a profit compared to its worth when they acquired it, and have a substantial amount of unrealized gains. The paper reads: ”Of the Ethereum still held by the projects, even at the current USD 230 price, projects are still sitting on unrealized gains, rather than losses.”

The research indicates that the ICOs still have net gains of around USD 93 million regardless of Ethereum’s value being put to the test this year, but this is because most of the funds were gathered prior to 2018: “It may surprise some that ICOs are still in a net unrealized profit situation, but many of the Ethereum balances were built up before the price rally at the end of 2017,”

BitMEX does acknowledge that the totals it published may reflect a lower amount than alternative sources due to its focus specifically on ETH balances and not funds raised in alternative forms.

The data project is also recognized to be slightly contorted by the EOS project, which accounts for 70% of the USD equivalent in ETH that was raised, although BitMEX says that without this data, a similar outcome is still met.

 

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South Korean Firms Actively Adopting, Generating Blockchain 3.0 Tech

Third-generation blockchain projects are in hot competition in South Korea’s bustling blockchain and cryptocurrency industries.

The term “Blockchain 3.0” has been cropping up a fair amount in 2018 to a mix of skepticism as to when it will truly arrive, with projects such as EOS and several others supposedly leading this race. In the case of South Korea, there is quite some fanfare as domestic companies begin to pair up with these new technologies.

Third generation

Blockchain 1.0 refers to the first and early technologies which were simply cryptocurrencies; Litecoin and Bitcoin are prime examples of this era. Blockchain 2.0 came about as developers began to understand that the technology could do much more than document transactions.

Ethereum is often touted as the beginning of the 2.0 generation with the introduction of smart contract technology on a blockchain and adoption of blockchain in enterprises. Industries grew given the versatile applications of smart contracts.

This new generation of Blockchain 3.0 is thought to be the catalyst for mainstream adoption. This latest round of solutions and platforms are said to address the issues of their predecessors with higher scalability, interoperability, governance and many others on the list.

As reported by Business Korea on 27 September, there a handful of blockchain enterprises that are becoming well positioned in South Korea’s markets, as well as one of its largest cryptocurrency exchanges, which is preparing a new blockchain platform through its subsidiary. These would all fit into Blockchain 3.0 descriptions.

Enterprise adoption

EOS has found itself being adopted by Neowiz Co, a leading games developer in South Korea who are now developing video games on EOS. The EOS network is pegged by Weiss Ratings Agency as one of the most innovative blockchain projects out there and is becoming increasingly favored by the gaming sector.

Orbs, an “Infrastructure-as-a-Service” (IaaS) platform from Israel, claims to be an improvement upon Ethereum. It uses the network’s best features while being faster, and includes a new transaction fee model among other interesting features.

This project is drawing a great deal of attention now with a strategic partnership in place with Ground X, a blockchain subsidiary of Kakao Corp, who also own one the world’s largest cryptocurrency exchanges, Upbit.

According to the Business Korea report, it is “highly likely” that Orbs will be collaborating with a blockchain payment project named Terra, a South Korean stablecoin project.

Additionally, Kakao is preparing to unveil the testnet for a blockchain platform developed by Ground X. “Clayton” is said to debut in October and is also in direct competition with Naver, South Korea’s largest internet content service company. Naver has produced the Link Chain platform, a payment and compensation method for numerous services including games, commerce, and content.

Blockchain enterprises in South Korea are receiving encouraging levels of support from the government as the nation seeks to formalize regulations and legislation for the industry. Despite being less in place than Malta, South Korea still a thought leader to other nations also seeking to enter the space.

 

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Binance CEO Speaks out on Blockchain’s Future and Why Dapps Are on the March

Binance CEO Changpeng Zhao has expressed his feelings regarding the future of blockchain in a recent interview with Fortune, expressing hope for its future.

CZ, as he is affectionally referred to, indicated that blockchain predictions, similar to those about cryptocurrency, should be taken with a pinch of salt. He sees specialized ledgers will change the face of crypto space, taking over from large blockchains such as Ethereum. Somethin already noted by some investors due to its somewhat tardy transaction speed.

Such startups as EOS, DFINITY and Tezos, reportedly described by some in the industry as “Ethereum Killers” are reputed to offer the same functionality but with greater efficiency, somewhat posing a threat to Ethereum’s dominance as a go-to cryptocurrency.

The Binance boss feels that such specialized blockchains could replace Ethereum over time with more specific tailor-made usage. He suggested that decentralized applications (Dapps) are the next big thing and that he enjoyed the opportunity to work with some these new decentralized projects seeing it as very much the future direction of the crypto industry.

Of course, he isn’t the first to have suggested this. According to Zerion founder, Evgeny Yuttaev, cryptocurrencies are still more speculative than used for practical utilitarian purposes, suggesting there is a lack of use cases for digital currencies in 2108.

He suggests that most ICOs seem to be in search of the next Bitcoin or Ethereum in search of massive profits, but what is really needed is projects which can change peoples lives, and for this to happen, Dapps need to become mainstream. Currently, there are 1,565 Dapps built on the Ethereum blockchain alone, unsurprising given Ethereum’s historical place in the development of blockchain solutions.

Such a view is in contrast with those of Ethereum founder Vitalik Buterin who feels that Dapps which pose a challenge to Ethereum consistently fail, although such a view is hardly surprising given where the network originated from – a smart contract exploit.

 

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XRP Is for Using Not Hodling Says Ripple

Cryptocurrency giant Ripple wants to get its digital currency XRP used rather than held speculatively or as an investment, writes The New York Times.

Ripple says it is having problems getting people to actually use XRP in the way it was originally intended, making simple electronic transfers quicker, easier and significantly cheaper than traditional banking or other financial institution methods. This isn’t happening, with Ripple suggesting almost no transactions other that users betting on their price or buying and selling for short-term profits.

The company hasn’t been scared to give away money, perhaps in the belief that funds will get out into the crypto environment and used as intended. Recently, charity airdrops have included a USD 4 million XRP donation to Ellen DeGeneres’s favorite charity and another XRP windfall for schoolteachers to the tune of USD 29 million on comedian Stephen Colbert’s Late Show.

Ripple is certainly chasing publicity in order to push XRP into the crypto psyche including the creation of a USD 300 million fund designed to pay companies for using the product. Another program, Xpring, pays developers for building XRP software.

Asheesh Birla, Ripple’s head of product, wants to get some of USD 30 billion worth of XRP out there and working, despite the token’s dramatic drop in value this year, explaining, “It’s still really, really early days, but we are seeing the vision come to life. I need to make sure it’s in the hands of the right folks.”

“The right folks” are people who know that they can use Ripple for transactions, but the company will have to convince these users that XRP has the potential to serve their needs in a number of practical ways and have global significance to companies worldwide.

Industry investor Spencer Bogart calls projects which are being used primarily as investment “Cash-Flush Business-Light” operations:

“Many people who bought the digital tokens created by these projects did so in the belief they will one day be useful for real transactions of some sort. If the projects want to keep those investors from selling, the projects have to convince them the tokens will have some long-term value.”

A company reportedly breaking this mould is Block One. Having raised USD 4 billion from investors, it is now using the funds to encourage developers to make its cryptocurrency EOS a useful product.

Some 60% of XRP are held by Ripple, a fact which may have unfavorable outcomes for the company, given that the SEC has clearly said that they will determine whether a token is a security by the number of tokens held by companies, and the degree to which the company is driving its sale. Ripple states that XRP isn’t a security as the currency would exist even without the company behind it.

Western Union announced that its new arrangement with Ripple as yet hadn’t shown any noticeable benefits, but the company is continuing with its trial, according to Fortune.

 

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EOS Block Producers Freeze User Accounts, Prompting Anti-Centralization Outcry

EOS block producers have frozen seven accounts in response to concerns from users that their wallets had been compromised due to phishing attacks. This has caused some controversy, likening EOS to centralized banks that freeze money at will. Some commentators believe this defeats the primary goal of cryptocurrency: to function as decentralized money that no centralized organization controls.

There has been a heavy backlash on social media following the block producer’s decision, and price dropped several percentage points when this story broke, shaving USD 300 million off the EOS market cap.

Some randomly elected 3rd party arbitrator is now making “orders” to #EOS block producers. In this case, regarding locking user accounts.

Can’t even make up comedy this good. pic.twitter.com/Dfs7UH0f5T

— Eric (@econoar) June 19, 2018

EOS recently migrated from the Ethereum blockchain to its own native blockchain, a process that ended up being slower and more difficult than expected. Concern over the centralization of EOS during the transition period, since full control of the network was handed over to a single block producer, caused a 30% price crash. Eventually, EOS went live after 15% of total EOS was staked in a vote, and dozens of block producers began to run the blockchain.

The migration resulted in a major opportunity for phishing scams, which is where the current problem stems from. It was a confusing and complex process for users to transfer their tokens to the EOS MainNet and vote for block producers, and many websites sprung up to help make the process easy. Voting requires the private key, and some of these websites ended up being fake and stole private keys.

A service called EOS 911 was created to report incidents of private key phishing. The block producers decided to protect users who had reported phishing by freezing their accounts indefinitely. The EOSIO Core Arbitration Forum (ECAF) is supposed to be in charge of such decisions, but it isn’t fully set up yet and decided not to rule. The block producers unanimously decided to take action despite this to protect users from losing their coins.

Regardless of the good intent behind the freezing of the accounts, the main concern is that block producers have this power at all. Effectively, EOS appears to exercise power just as a centralized bank would.

Perhaps even worse than freezing accounts, professor Emin Gun Sirer from Cornell University says EOS block producers can reverse transactions. If true, this means EOS transactions are never final, which could result in serious losses for merchants and exchanges down the road depending on block producer’s decision making.

Cryptocurrency generally has intrinsic value in its unique aspects of decentralization and irreversible payments. EOS appears to have eliminated these positive characteristics and has put control over user money into the hands of a small group of block producers.

Theoretically, block producers must act unanimously for accounts to be frozen or transactions reversed, and for the time being all 54 active block producers have been working together in a centralized fashion via conference calls. However, it is possible in the future that block producers will fall into disagreement and stop working with each other like this, which would help increase decentralization.

That being said, block producers are determined via voting which is directly tied to wealth. Someone with enough money could vote for themselves and take over EOS block production and then proceed to steal coins, attack other users without reason, or even go as far as destroying the entire network. The idea of having block producers who can easily modify transactions might be the fatal flaw that negates all the other positive aspects of the EOS platform.

 

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$4B EOS Project Launch Slows Amid Centralization Fears

After the biggest initial coin offering (ICO) in history raising USD 4 billion, Block.one’s officially released EOS native blockchain software launched on 1 June 2018 but has since been moving very slowly. Uncertainty surrounding the project, largely blamed on centralization concerns, has caused a 30% decline in EOS price, shaving more than USD 4 billion off the market cap.

A price rally from USD 12 USD to over USD 15 occurred around the time the software was released, and price declined a little but was relatively steady following the release until the genesis block on 9 June 2018, starting the blockchain.

Worries over EOS centralization is thought to have severely affected price, however. EOS uses delegated proof of stake (DPoS), which is different than normal PoS since not every wallet that is staking will help validate transactions – only block producers will be able to validate transactions into blocks and receive rewards for doing so.

These block producers are being voted on by staking EOS, and 15% of all EOS (150 million coins) need to be staked before block producers are selected. This process has been going very slowly, with only 30 million EOS used to vote so far. The slow rate of voting is thought to be due to confusion on how to vote, made worse by the potential for getting scammed since users must expose their private key to vote.

During this intermediate time between the genesis block and the completion of voting, the EOS blockchain is being run by a single block producer, EOS New York. This was not the original plan, as there were supposed to be 21 block producers during this time. Having only one block producer makes EOS very centralized, raising serious concerns and fear in the market, leading to a price crash.

EOS began as an ERC-20 token with no special functionalities since it first started trading on the markets in July 2017, yet speculation has caused it to become the fourth largest cryptocurrency by market cap behind Bitcoin, Ethereum, Ripple, and Bitcoin Cash. This speculation was driven by Block.one’s promises that EOS would be an entire operating system for decentralized blockchain-based apps, with quick transaction times and the potential for millions of transactions per second.

Clearly, the market is skeptical about this due to the launch and voting process that has taken over ten days so far and has no end in sight.

 

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$4B ICO EOS Launches Blockchain

EOS is launching its own native blockchain after a year-long initial coin offering (ICO) which raised USD 4 billion, the largest ICO in history. Up until now, EOS has been a simple ERC-20 token that uses the Ethereum blockchain and had no accompanying technology that made it special.

Despite the lack of underlying unique technology, speculation has caused EOS to become the 4th most valuable cryptocurrency behind Bitcoin, Ethereum, Ripple, and Bitcoin Cash with a market cap of USD 13 billion and daily trading volume in excess of USD 1 billion.

Finally, block.one, the company that started EOS, has released EOSIO, an open-source software that claims to contain all the blockchain technology promised during the EOS ICO. Due to the risk of multiple EOS blockchains launched simultaneously, the EOS Authority is tracking the launch of the main blockchain and will give official word when the actual EOS network is operating, slated to occur around 5 June 2018.

Exchanges have frozen EOS deposits and withdrawals until the new blockchain is up and running, while users are advised to stop transacting EOS for the time being. Right now, EOS is migrating from the Ethereum blockchain to its own blockchain, the essential equivalent to a hard fork, with users potentially losing funds if not migrating properly.

EOS promises to be a platform for the commercial development of blockchain applications. EOS aims to be an entire operating system allowing for easy development and maintenance of blockchain applications, which has the potential to increase blockchain technology adoption and use if it lives up to its promises.

EOS will have the fastest transaction confirmation time out of any major cryptocurrency, at a mere 0.5 seconds between blocks. Also, there won’t be transaction fees for users depending on how much EOS they stake; in return for staking EOS and maintaining and securing the network, they get free transactions.

Theoretically, EOS could reach millions of transactions per second with no transaction fees, solving the cryptocurrency scalability problem. This is a long-term issue that Bitcoin has been dealing with, it currently can only handle up to 10 transactions per second, with transaction fees going as high as USD 50 in the past at peak demand.

Voting will be integrated into the EOS protocol, allowing for changes to be made to consensus mechanisms without a hard fork. This solves another deficiency of traditional blockchains, whereby changes of protocol can only be done via controversial hard forks.

The EOSIO software could be technology that will advance the world of blockchain applications. Only time will tell though, first its blockchain has to launch and function correctly.

 

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