EOS is a cryptocurrency that has drawn a lot of interest from the cryptocurrency world over the past few weeks. Weiss Cryptocurrency Ratings, however believes that not everything is golden about this coin, with its centralization, the main reason why they are against it.
EOS has been receiving a lot of attention following the conclusion of its year-long ICO that resulted in the project raising $4 billion. This increased some people’s belief in the project as they believe it would eliminate the scalability problem of Ethereum and be able to process millions of transactions in a second while also eliminating transaction fees.
Weiss Ratings Not Too Impressed
Cryptocurrency ratings firm, Weiss in a blog post yesterday, raised some concerns about the EOS network. The company noted that they are fully behind the goals that EOS aims to achieve, stating that;
EOS is a great project. It still merits a good Weiss Rating overall. And it still has the potential to do what Ethereum promised — take the crypto world to the next level, and establish a foundation for the smart economies of the future.
EOS has been recognized as the premiere fully scalable, complete, third-generation blockchain that the cryptocurrency public have been given access to. However, Weiss raised concerns about the massive centralization of the cryptocurrency. The ratings company in its blog post noted that the primary aim of EOS is decentralization, with the team stating that the future development of the platform is controlled by the EOS community.
However, the firm revealed some concerns about EOS.
Whales Control the Market
Weiss in their post, revealed that EOS is the most centralized blockchain in the world at the moment;
Identified EOS as a platform with one of the most centralized distributed ledgers in the world today.
Its Gini coefficient ranking is a whopping 97 from of a possible 100, implying that the platform is considered more like a feudal kingdom, with the power of the community in the hands of just a few individuals.
Recent reports show that the top 10 coin holders control over 50% of the entire market. The network has just 21 bloc producers and each token will give the individual holding it a vote for 30 different block producers. This will ultimately lead to the whales determining who the block producers would be, with the community left with no choice than to accept that.
Weiss didn’t just state the problem, they offered some solutions for that. The company urged the whales to reveal themselves, as this would lead to greater transparency. After that, each token shouldn’t be given 30 votes. Also, the network should have more than the current 21 block producers and lastly, the whales voting power should be limited to just 2.5% of total EOS toke supply.
If EOS would heed the advice of Weiss is something no one is sure of but the concerns raised by Weiss is shared by many others in the cryptocurrency world.