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Understanding EOSIO (EOS)
EOSIO (EOS) is a cryptocurrency and blockchain technology platform developed by the company Block.one. The native digital currency of the EOSIO blockchain is EOS. EOSIO supports smart contracts, enabling transactions to automatically execute when certain conditions are met.
The EOSIO platform uses a unique approach to efficiently complete transactions. Keep reading to get a closer look at what EOSIO is and how it works.
What is EOSIO (EOS)?
EOSIO (EOS) is a blockchain software platform and digital currency. Similar to Ethereum, EOSIO supports smart contracts—blockchain-based electronic contracts that follow if-this-then-that logic. EOS is the cryptocurrency that powers EOSIO.
The EOSIO blockchain uses an operating method called delegated proof of stake. The delegated-proof-of-stake method is designed to enable transactions to be processed quickly and cheaply, without the need for vast computing hardware.
The EOSIO blockchain platform hosts other blockchains and projects, including non-fungible token (NFT) projects and games. More than 500 decentralized applications are built on the EOSIO blockchain. EOSIO-based projects include virtual games, online marketplaces, decentralized finance apps, and cryptocurrency exchanges.
The maximum coin supply of EOS is not capped. More than 1 billion EOS are already in circulation.
How does EOSIO (EOS) work?
EOSIO relies on a consensus mechanism called delegated proof of stake to operate the EOSIO blockchain. Here’s a look at how EOSIO works:
- New transactions are pooled: Users initiate new EOS transactions, which are pooled into a block for processing.
- EOSIO validators are chosen: Holders of EOS are known as delegators. Delegators choose validators to process the latest block of EOS transactions. EOSIO network participants who stake their EOS are eligible to validate new EOS blocks.
- EOSIO validators process transactions and mint new EOS: The chosen EOSIO validators, known as block producers, process the new block of transactions and simultaneously mint new EOS.
- EOS is awarded to block producers and delegators: The newly minted EOS is paid as a reward to both block producers and delegators. EOS holders must maintain a compatible wallet or cryptocurrency account to earn EOS rewards.
- User account balances automatically update: After the new block of EOS transactions is processed and added to the EOSIO blockchain, users’ wallet or account balances should automatically update.
EOS currency holders also maintain the right to vote on the future of the EOSIO blockchain—making EOS a governance token. The EOSIO blockchain is designed to reward network participation and those with significant EOS holdings.
Projects supported by EOSIO
The EOSIO blockchain platform supports its own core blockchain in addition to several others. EOSIO also hosts a variety of decentralized applications and projects. These are some of the projects on EOSIO:
- Telos: Telos is a public blockchain built on EOSIO, focused on empowering mass adoption of blockchain technology.
- WAX: Another blockchain built on EOSIO, WAX—short for Worldwide Asset eXchange,—is a blockchain platform designed to make e-commerce transactions faster and safer.
- Upland: Upland is an online real estate game that uses EOSIO to manage its in-game currency and property ownership. Upland is EOS’ most active app, with more than 250,000 active monthly users.
- AtomicAssets: This project enables anyone to tokenize assets to create non-fungible tokens. AtomicAssets uses EOSIO to track the NFTs that it produces.
- AtomicMarket: AtomicMarket creates shared liquidity across platforms for NFTs. The project uses EOSIO to support its shared liquidity pools.
- Yup: This project uses the EOSIO blockchain to operate a decentralized social media platform. The Yup project bills itself as a “social curation layer for web3.”
- Wombat Dungeon Master: This game lets you hide NFT loot and open your virtual dungeons for wombats to lurk around. EOSIO supports the NFTs in the Wombat Dungeon Master game.
A brief history of EOSIO
The for-profit company Block.one was founded in 2017 to develop the EOSIO blockchain platform and other projects. In June 2017, Block.one completed the first tranche of an initial coin offering (ICO) for EOS, raising nearly $200 million through the sale of new EOS coins. EOS was initially released via the Ethereum blockchain before moving to its own autonomous blockchain.
Block.one throughout 2017 and 2018 continued to release new EOS as part of the initial coin offering. The ICO concluded in June 2018 and ultimately raised more than $4 billion, but its success is marred with controversy. Researchers in 2021 found that a small number of accounts were likely responsible for pumping up the price of EOS during the time of the ICO.
Block.one in September 2019 also settled a case with the Securities and Exchange Commission (SEC). The SEC alleged that the EOS initial coin offering was an unregistered securities offering, resulting in Block.one paying a $24 million fine to the agency.
The open-source EOSIO software has been available on the development platform GitHub since December 2017. Anyone can view and contribute to the EOSIO blockchain code.
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