For years Ethereum has dominated the smart contract market. Its features and functionality were way ahead of their time and no other platform came close to matching it. Well, not until EOS launched at least. Although Ethereum has dictated what smart contracts are today, now it seems like EOS is re-defining them. EOS promises major developments where Ethereum has been challenged and new features to make a better protocol. Much of Ethereum’s shortcomings have been around the slow speed of the network and the problem of scalability.
Security, Decentralization, And Scalability
These three attributes are what have made the two decentralized app (dapp) platforms very different. Their approach to scalability, decentralization, and security is what determines for users which platform to choose and what is leading to both becoming two of the most competitive cryptocurrencies.
This is one of the most worrying issues for Ethereum. Vitalik Buterin, the founder of Ethereum, has already admitted that this is an issue on the network and promises to continue to improve on it. Scalability is all about how many transactions the network can take at a time. For Ethereum, this number is too low and slow. Currently, the Ethereum network will only take 15 transactions per second and this has been criticized since companies like Visa will handle 50,000 transactions per second.
EOS has managed to solve the problem of scalability. The blockchain network boasts of 1,000 transactions per second. The team is also in plans to improve on this and make it millions of transactions per second. However, before that, already 1,000 transactions against 15 transactions is already much better. Its scalability also increases its effectiveness in usability since it has become cheaper and faster than Ethereum. This scalability has however come at a price and it’s a big one. EOS is more centralized than Ethereum. Ethereum is decentralized and its fans take this feature to heart. EOS, on the other hand, is central and the network is even known to freeze user accounts.
Security of a blockchain refers to the ability of the network to withstand attacks. EOS has been having issues when it comes to security. It is because of a few network manipulations witnessed during the launch of its mainnet that the network froze accounts. The platform also has a lot of bugs opening the network to vulnerabilities. Granted, this project is still developing and it will take a little longer to be as stable and secure as Ethereum which has been around for years. Ethereum has prioritized security and it is one of the few projects that has not suffered from a security scandal.
EOS seems to have sacrificed security for speed and scalability.
EOS has shown to be better than Ethereum in more ways than one count but there is one reason that beats the whole purpose of its existence, centralization. EOS is centralized in that its mining rewards are given to the top 21 honest nodes. Unlike bitcoin and Ethereum where anyone can mine bitcoin and be rewarded, EOS has a different approach. EOS users vote on the authenticity of a block and the top 21 honest nodes produce the new nodes. This makes the process centralized to 21 players on the network.
The same can be said for Ethereum given that the network is controlled by a few mining pools which control almost half of the network. However, it is not the same. Ethereum uses Proof of Work model while Ethereum uses the Proof of Stake model.
Other Major Differences Include:
Transaction fees- Although EOS requires you to stake tokens before executing a Dapp, they are reimbursed immediately after executions. Ethereum, on the other hand, requires users to burn (Gas) when executing smart contracts. This has pushed more projects toward the EOS network in recent times.
ICO Launch- EOS brags of one of the largest ICO launches which saw the project generate about $4 billion in token sales. This showed that investors have confidence in the project. Ethereum back in 2015 only raised $18.4 million but it is important to point out that back then smart contracts were unheard of.
Ethereum is stable and lives up to the fundamental belief of blockchain technology, however, it requires to improve on its scalability or else it won’t matter whether EOS is centralized or decentralized. Efficiency comes before everything else. Ethereum might have a bigger and more loyal fan base and community than EOS, but without some fundamental changes, EOS will go right past that number.