EOS and its weak mainnet launch is worrysome and a bad sign for the whole crypto market

EOS (The Evil Operating System?) is probably the best example of how crazy the crypto markets and investors are. EOS is a not-yet-ready network that found dozens of critical bugs right before mainnet launch and has a market cap of $10+ billions and GitHub, a 10-year old application with 30 million monthly active users, awesome UX, and extremely strong network effect was sold for $7B.

If this is not irrational exuberance then I don’t know what is.

After months of preparation and expectation, EOS, the blockchain announced as “Ethereum Killer”, has launched its Mainnet. I do not have the competence or insight to comment on this launch. But according to various reports, it was a disaster.

For example, The Next Web reports that a Chinese security company has found numerous bugs in EOS. Shortly afterwards, EOS launched a bug bounty program that pays hackers $10,000 per bug. Just a week later, a hacker had made $120,000. Then EOS adopted a constitution that may favour the company behind it, Block.one, and may even establish it as the central government of EOS. A recording of a call from the 21 “block producers” shows that they can even arbitrarily create new EOS tokens.

The fact that there is an arbitrary vote between BPs only in a closed session (the notes’ link was leaked to pastebin) is alarming. Plutocracy already in effect. Minimizing reliance on doing the right thing and hoping that all the participants in the game’s interests align is paramount.

There are also numerous other criticisms of EOS. For a project that has raised an incredible $4 billion to build the “Ethereum Killer”, this is not only disappointing, but a disaster. In any case, many people suspect that the price of the EOS tokens is subject to considerable manipulation. Not only because the company behind it, block.one, is also involved in tether and possibly Bitfinex, but also because the EOS makers have collected enough ether through the ICO to manipulate the price.

Overall, EOS should show better than anything else in what questionable condition parts of the ecosystem are. As long as a thing like EOS is worth more than $10 billion, real, sustainable ground should not even be in sight. For me, the weak EOS launch is the most convincing, but not the only reason to worry as an investor.

Richard Burton came up with a nice elucidation of what EOS actually stands for:


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Rene Peters
Rene Peters

Rene Peters is editor-in-chief of CaptainAltcoin and is responsible for editorial planning and business development. After his training as an accountant, he studied diplomacy and economics and held various positions in one of the management consultancies and in couple of digital marketing agencies. He is particularly interested in the long-term implications of blockchain technology for politics, society and the economy.

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