Cryptocurrency News

Weiss Ratings Downgrades EOS for Centralization

The Weiss Crypto Ratings chart saw EOS slide down the ranks. Weiss downgraded the project, pointing centralization as the chief reason.


Weiss Moved EOS Down Straight to C-

Weiss Ratings downgraded EOS from B to C-, despite the favorable estimations in the past. The chief reason was the influence of big token holders, which could decide how to sway network resources.

The EOS blockchain gains its speed from the feature of only having 21 block producers, which transpire transaction information amongst themselves. Thus, spreading the latest state of the distributed ledger is easier, in comparison to Bitcoin’s feat of broadcasting to above 9,300 anonymous nodes.

The EOS Constitution also has special cases for blocking accounts – a feature which has been useful during hacks, but also means transactions can be censored centrally.

The concentration of resources in only a few hands meant “whales” could decide on allocating activities. This is also one of the reasons why the EIDOS token spread like wildfire, consuming almost all transactions on the EOS network.

Network Capable of Faking Activity, Hosts Parasitic Token

EOS is a network similar to older ones like BitShares, as well as Steemit. Those networks have shown that the influence of “whales” can be immense, and two nodes could even broadcast millions of free transactions.

Other networks like Lisk (LSK) showed that the election process for delegates ended up with voting power getting accrued in the hands of a few top delegates. All of them could vote each other into place, without resorting to regular user vote.

EOS trades at $2.75, gradually declining from the mid-year peak above $6.00. The coin has erased most of the gains for 2019 and is on track to fall to lows not seen since the bear market of 2018.

According to Blocktivity, the network carries more than 43 million transactions per day.

Most of those now belong to minting EIDOS tokens, while other transactions are related to distributed app activity. EOS has also seen accusations that most of its dApps are visited by bots, faking the real usage statistics.

What do you think about EOS’s latest crypto ratings (as per Weiss)? Share with us in the comments below. 


Images via Shutterstock, Twitter: @WeissCrypto, @enumivo

Weiss Ratings Downgrades EOS for Centralization

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cryptohero8
I am a believer of the HODL philosophy because we are still in the nascent stage of blockchain technology. Although we are in a bear market now, my outlook on the adoption and growth of blockchain solutions remains unchanged. Blockchain transactions has been growing exponentially and demand for cryptocurrency like Bitcoin [BTC], Ethereum [ETH], Ripple [XRP], Litecoin [LTC] and other Altcoins will only continue to grow exponentially in the next five to ten years.

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