Vitalik Buterin, a Russian cryptographer and programmer is the creator of Ethereum, he is one of the most popular names in the crypto arena. The first ETH transaction took place on 30th July 2015. Ethereum is a public, open-sourced Blockchain based distributed platform for developing smart contracts. All the nodes of the network are on the main chain providing support to different tokens for payment in the form of GAS. An EOSIO Smart Contract is software that is written on the Blockchain to be executed on the nodes.
Dan Larimer is a world re-known crypto entrepreneur. The Blockchain projects he has worked on are; he’s founded – Steemit, Bitshares, and now EOS – are worth billions, making Mr Larimer as wealthy as he is successful. Dan’s vision towards cryptocurrency is wide but oriented. He has found key solutions to the three biggest issues on the internet – Information sharing and rewards system, a decentralized currency exchange platform and dApp (Decentralized Applications).
Rise of Dapp Platforms
Both ETH and EOS were introduced a couple of years apart from each other, in cryptography years in relation to the development of the Blockchain industry they might be decades apart. The younger generation of EOS is advanced and evolved against the older but gigantic ETH; which is one of the pioneers for smart contract and is second in total market capitalization. ETH was one of the first cryptocurrencies to gain world-wide traction and allowing the development of independent Blockchain Tokens. It was responsible for the ICO revolution, many cryptocurrenies today run on the ETH blockchain, e.g. ERC20 token.
The Race Begins: Similarities and Differences
The market capitalization of ETH is nearly four times that of EOS, however the ratio of daily volume is around 2.4. Before knowing total supply for both the cryptocurrenies, it needs to be noted that EOS coins are pre-mined following a dedicated Proof Of Stake (dPOS) protocol whereas ETH follows Proof Of Work (POW) where miners secure the network.
The Proof Of Work (POW) network has miners that collectively support a hash rate of 300000 GH/s (average) using GPUs and dedicated mining systems. There are mining parts in various parts of the world that are dedicated to ETH mining, so much so that for GPU miners ETH hashrate is treated as the Benchmark for unit calculations of profitability. Litecoin and Bitcoin one of the oldest cryptocurrencies also work on the POW consensus protocol, a network secured by miners. The POW network provides security against mutation of the blockchain, this feature in a highly dynamic environment where people are scavenging for free money exposes it to the risk of sudden drastic alterations in the Blockchain. EOS has solved this impending crisis by introducing dedicated Proof of Stake (dPOS); which allows the voters (Nodes) to decide what path to take on a specific situation, hence steering the blocks on the Blockchain to follow a particular protocol, others who decide against are eventually die out as they keep losing nodes to the major chain. This might seem confusing but essentially it represents a dynamic voting consensus algorithm where in case of error or malicious attack the network can immediately decide to follow a different protocol and expel (‘boycott’) the malicious nodes.
EOS can scale vertically and horizontally i.e. both the EOS Blockchain and the respective Tokens built on it can scale upto million transactions per second. ETH on the other hand has a speed of not more than 100 transactions per second. This is the Achilles heel of the ETH network, transactions speed to support a worldwide network of decentralization would require scaling to a huge rational number. ETH network has been attacked a couple of times once during the DAO (Decentralized Autonomous Organization) fiasco, which led to an attack amounting to 21 million dollars eventually leading to the birth of a hard-fork. Hard-forks split the Ethereum network into ETH and ETC, where ETH network restored its blockchain to new protocol eliminating and disallowing the malicious transactions on the ETH network, hence restoring the money. Nonetheless, there losses were incurred due to market price reactions. It was attacked again in December 2017 by a program called ‘cryptokitties’ that took control of 21% of the entire network clogging the network with useless transactions.
EOS network is Hard-fork proof, instead of splitting the network, the nodes vote and then follow the desired protocol, and the majority of the network followers eventually drive the network forward. This is also a reflection on the stability of the price of EOS which is resistant to sudden attacks avoiding investor losses. Moreover, the developing team behind Ethereum has also proposed upgrades to the ETH Blockchain including a POS system shift and child chains. It has to solve the problem of scalability as well to compete with the new entrants. EOS, meanwhile continues to gain adoption among the developers making it the fifth largest in terms of market capitalization. We will see which of these two cryptocurrencies succeed in the long term wide-spread adoption of smart contracts in a year or two.