Ever since its’ year-long, controversial ICO wrapped up this summer, EOS has not exactly been free of controversy. On the contrary, there have been multiple allegations of the network being centralized, even though it has consistently promised true decentralization.
Today’s news on EOS is no different. If you know anything about how this network is governed, then you may already be aware of its’ 21 "block producers." If this is not the case, rest assured that their roles are quite easy to grasp. Overall, these 21 nodes vote on any proposed change to or issue with the network. The overarching idea of why this promotes decentralization is that they were voted into these positions by all the network’s participating nodes.
At this point, we can circle back to our reference to today’s news and explain why this might not be such a decentralized form of governance after all. Before we jump into this discussion, it is first important to understand the idea that block producers also effectively mine EOS coins for all other network nodes. This process, which is often called mining by proxy, may be considered controversial because it involves network users putting their faith in a third party that does not directly represent the network’s interests. Even so, EOS depends on mining by proxy at least, for now, to continue functioning efficiently.
Last week, one particular block producer posted on Medium in what appeared to be an attempt to incentivize EOS users to gravitate towards it above others, as one of these miners. While in general, this may not seem too controversial, it becomes so once more of the relevant details are known. If you are wondering what we mean by this, it is as simple as the fact that Starteos, the producer in question, promised anyone who signs up with them consistent profits. This, in and of itself, is an abuse of elected power in any context. As is suggested by Cointelegraph and other media personalities, this appears to be blatant vote buying.
Against all odds, however, Starteos has basically refrained from answering any of this criticism and EOS has also managed to maintain a market cap of more than $2 billion. Since criticism of the network’s activities seems to be showing no signs of slowing down, only time will tell if EOS investors will ever take any of it seriously.
By: BGN Editorial Staff