Ethereum VS EOS.IO

When it comes to these two names, a lot of questions are brought up.  They seem to be highly compared and for good reason.  There are many different articles written on this topic, but I want to make it as easy and simple for new traders and investors to understand.

First, I want to start off by saying that both of these blockchain technologies have tremendous leadership behind them, Ethereum lead by Vitalik Buterin and Dan Larimer of EOS.IO.  Both Vitalik and Dan have had great success establishing themselves around the cryptocurrency and blockchain industries.  Ethereum is indubitably the most successful and largest platform created for decentralized applications (dapps), but EOS.IO is seeking out solutions to solve several challenges faced by the Ethereum network.

Let’s first talk about a very important topic and this is consensus mechanisms.

Ethereum uses Proof-of-Work (POW) and Proof-of-Stake (POS) mechanisms and these require enormous amounts of hashing power and a massive distribution of network tokens to make sure the application is valid and secure.  What this means, is that small businesses or start-ups don’t have enough capital or labor pool to freely create and maintain a widely distributed, powerful computer network that keeps their application secure.  Also, Proof-of-Work consensus mechanism in a nightmare when it comes to fixing a broken application.  A disruptive hard fork is required to fix a broken application, and this will disarray the whole Ethereum network.  With each hard fork comes risk because competitor chains can be created and a great example of this is how Ethereum Classic split following the DAO failure.

EOS.IO uses what is called a Delegated Proof-of-Stake (DPOS) and this is a Graphene based technology that can operate by a small number of processors without network security concerns.  They include a mechanism that will put a freeze to broken applications, and can’t create competing chains during a hard fork.

The next thing I want to dive into is scalability.

The Ethereum network is restricted by the single threaded performance of a CPU.  The transaction limit of ETH is about 10 transactions per second or less.  History shows that the network has been overwhelmed with transactions to the point that all but the highest-fee transactions were rejected.  As far as the future goes for Ethereum and scalability, they have unlimited scalability on the roadmap, but this would have to come with a concept known as “sharding.”

EOS.IO has a few different advantages in this category in my opinion.  EOS will likely be on the only platform that can handle commercial sized dapps.  The EOS platform is a very exceptional block-architecture that can scale up anywhere between 10,000-100,000 transactions per second.  They will also use parallelization to scale the network which can reach as high as millions of transactions per second.

They have a few more differences such as fees and design philosophy but I wanted to stick to the most important differences in my eyes.  My final thoughts on ETH vs EOS is that I am not biased with either project.  I am an investor and #HODL of both and would love to see both projects succeed in the future.  I do want to add that I think Ethereum is more successful because it was first to the party, and being first won’t always guarantee you success in the end.  EOS has a very strategic plan to fill in any gaps that are holding ETH back, they got to sit back and see what went wrong.  A good example I like to use for this is AOL (American Online), they were first but we all know what has happened to them now.  The platform is fairly obsolete and now the internet is run by powerhouses like Comcast, CenturyLink etc.


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