Ethereum VS EOS

What's up everyone? Today I want to talk about the epic battle between Ethereum and EOS. So there's been a huge debate recently about these two coins and there's actually a back and forth between the creators of Ethereum and creators of EOS, Vitalik Buterin and Dan. And they've been talking about various features of these different protocols. And today I want to make a video about a little bit of a summary about what these kind of major arguments are and also weigh in a bit about the technology as well. Of course, this is my personal opinion and this is not financial advice. There will be a slight summary and simplification of the arguments here. And if you want to read more, I'll put links down below where you can actually start reading more about this. Let's start off with Ethereum first of all. So what is the value of Ethereum? So Ethereum can do really two major things. One is the creation of smart contracts. So if you have Bitcoin, which is a transfer of value, Ethereum is programmable transfer of value. For example, I say if you do a certain task for me and you can submit proof of this task, I'll pay you X amount of Ethereum. So now by submitting mathematical proofs, you can obtain these funds without me actually distributing them. So it's a way of making sure that every party does what they want. This is because the program is impartial and not subjected to kind of various manipulations. So once this contract is up, the terms cannot be changed. Thus, it's very secure. Another example of what you can do with smart contracts is to form decentralized apps. For example, if I can win this video game, I am going to get paid X. Or if I can win this video game challenge, I can get paid Y. So that is kind of like a simple description of first blood. So this is kind of a whole esports thing where you can actually start running esports tournaments and getting payouts based on Ethereum. Now, the advantage of this is that, first of all, if you do this with Ethereum, there's no need for a third party. And also, of course, you have this kind of guarantee that payment is going to be made. There's also a lot of examples of decentralized apps running on Ethereum. For example, you have the Ethereum name service, which allows you to buy an Ethereum name. And you can actually interact with the smart contract and actually make purchases without interacting with a central body. So this is actually a stark contrast to current systems where there is a center and there's someone controlling it. Here, a computer program, a computer code controls everything. Now, with this, you can build a lot of applications and a lot of applications are currently being built. But right now, it's still in a hypothetical stage. Can we build them? And if so, are they very useful? I do want to say that Ethereum is terrain complete. Without going into too much detail, computers have a few basic operations. And with these operations, you can create almost anything. For example, Microsoft Windows, Microsoft Word, Photoshop. You can do almost anything with these basic operations, which means that it can actually function and use these kind of basic operations to build very, very complicated programs. So technically, it can do almost anything on a computer. And that is why there's so much interest in Ethereum. There's so much kind of potential to do smart things with programmable transfer of value. Now, there's also another thing on Ethereum as well, which is the support for tokens. And now this year, we've seen so many initial coin offerings and so many projects getting funding from coin offerings that all of a sudden, Ethereum is now a platform for supporting initial coin offerings. So let's talk about EOS now. So what can EOS offer? Why would EOS be an Ethereum killer? EOS can technically do everything that Ethereum can do. But it also tries to tackle a few of the challenges that Ethereum faces. So this year, we saw the Ethereum network being extremely, extremely tight during initial coin offerings. For example, there's so many transactions happening during an initial coin offering launch, for example, the basic attention token, that it took almost two hours for transactions to be sent or received. And this is a very, very, very long time. And people are just talking about the scalability of Ethereum. So there is a worry that in the long term, Ethereum can't scale as fast. And EOS is trying to tackle this issue. Not only does EOS try to tackle the problem of scalability, I think that's probably the smaller part. The larger part is actually with how users interact with smart contracts. Currently, when you want to interact with a smart contract on Ethereum, the user must pay GAS. This GAS is charged kind of for transcomputational time on the Ethereum network and computational cycles. That means that if you want to, say, buy an Ethereum domain, you must actually pay a little bit of extra for GAS for the computation. But this makes sense when you're buying something. But what if you're just interacting with a service? What if you just want to send a message or you just want to add something to the network? Well, then it doesn't really make much sense to pay, for the user to pay. I mean, when you interact with Facebook, do you have to pay to make a post? That doesn't make any sense. Well, EOS tackles this problem by having the creator of the contract hold and stake tokens. And the users who interact with it don't have to pay anything at all. So this is kind of a flip between who pays and who fits the bill. So now with EOS, the creator can foot the bill, whilst the users can just enjoy it for free. So that's a huge, huge difference in how these things operate. And what they're claiming is that with EOS is claiming is that with this method, you're going to allow more ways to interact with contracts and more ways to form decentralized apps because now the user doesn't have to pay anything. So you can technically, theoretically, build a whole social network on EOS. And that way, it will work very much similar to Steam, a creation of the co-creator of EOS, Dan Larimer. So that was the kind of claim to fame of EOS. EOS is now this mega operating system that can build many, many decentralized apps on. And you can actually build it easily and without kind of users having to foot the bill. So EOS has these two advantages, which is speed and, of course, support for decentralized apps. And on top of that, EOS has a lot of other technological, technically, upgrades. For example, it's using delegated proof of stake and also protocol changes. I won't cover these in detail, but it's very interesting to look at. One other advantage of EOS is that code placed on the network isn't actually machine code. It's actually almost in a readable form. So if you want to inspect a smart contract on EOS, technically, you can do so. While in contrast, on Ethereum, it's machine code. So it's actually in a non-readable form. Now, that makes a huge claim that it sounds like EOS is an Ethereum killer. Because it's got these mega changes and it can handle more transactions. It sounds like it's a little bit better than Ethereum, right? Well, there is an issue, though. EOS as a project hasn't been proven. In fact, it's just a piece of paper. It's a white paper, in fact, with the code, the primary code not completed. So EOS is a theoretical platform, a theoretical protocol that hopefully can work. Right now, it's in the initial coin offering phase. They're seeking funding to actually get this project launched. And in fact, their whole project will take one year to fund. So the EOS kind of token sale is ongoing. And it will actually take a whole year to distribute the 1 billion tokens out there. On top of that, there's a lot of speculation right now about how safe EOS is. It's still not being built, but is this plan, is the architecture safe? And that's been the crux of the argument so far. For example, Vitalik has pointed out that delegated proof of stake isn't actually very safe. Because in the long run, if there's not enough people voting, if not people participate, then the security of the network might be under scrutiny. There has been a back and forth between Dan Larimer and Vitalik. Dan has also addressed the issue with EOS in that it's much faster and produces more blocks. Dan has also said that he's dealt with voter turnout in the past in response to Vitalik's comment. Vitalik has also stated that the removal of certain hash signatures from EOS means that the system isn't very secure. And there might be long-term issues on a protocol level. Whilst we do see that there are hacks on applications built on top of Ethereum, the Ethereum protocol has been secure and you won't magically lose funds for no particular reason. What Vitalik might be saying is that with EOS, there might be protocol level flaws, which means that in the future, potentially hackers can just steal off EOS. This has, of course, not been proven. So it's going to be a long battle to come. And I think my personal view on this is that this is going to be the most epic battle in a year's time. Right now, we're so early on EOS that EOS hasn't even been built yet. And this battle hasn't really begun. Right now, it's mostly speculation and theory. I still have a lot of doubts as to whether Dan Larmer can actually complete the project on time. He has a lot of experience, for sure. And he's built two successful projects in the past. But can he really complete this project on time to face off Ethereum? Because Ethereum is also growing as well. It's a very fast growing chain. It's going to adopt proof of stake first. There's going to be new releases. And there's going to be many, many upgrades to come. So technically, EOS is also competing against a moving platform as well. Both of them are moving at different speeds. And when EOS is actually finally built, when we compare the final product instead of a theoretical product with EOS, and the final product of Ethereum at that time, it might be a very interesting battle indeed. I do want to say that with EOS right now, the token sale is actually on Ethereum, which is kind of hilarious if you think about it. These tokens will actually be changed into actual coins that are used on EOS once it's built. So actually, right now, you're just buying the promise of EOS and promise of coins, which is kind of hilarious if you think about it. So if you guys are actually looking at this argument, the crux of the debate, I think, can't really be argued at all right now because of the incomplete state of EOS. EOS is actually just a paper and not a product. And Ethereum, on the other hand, has actual apps running on it. But of course, it's going to definitely be very interesting to look at EOS. I've been looking at it for almost three months now. I'm just looking into different features. And if you guys wanted me to talk about different features of EOS, I would love to do so in future videos. Guys, I hope you enjoyed this video. This really covered the kind of outside layer of the argument. And I hope you guys can have a lot of questions for me. And I'll do more videos on this soon. Thank you guys so much for watching. See you next time.