Throughout a year-long preliminary coin providing (ICO) that resulted in 2018, EOS raised a file $4.2 billion, making it the most important ICO in historical past. Mixed with its Delegated Proof-of-Stake (DPoS) consensus mechanism, which has throughput hundreds of instances higher than Ethereum’s, expectations had been excessive.
However these expectations proceed to go unfulfilled. A have a look at EOS’s stagnant dapp growth, and slide within the CoinMarketCap rankings, reveals a mission that has fallen by the wayside.
In December 2020, the CTO on the growth agency behind EOS, Dan Larimer, resigned, including to the mission’s unsure future.
However new analysis from forensic monetary evaluation agency Integra FEC throws contemporary doubt on the mission’s viability.
What occurred to EOS?
The explanations for EOS dropping by the wayside are many. First, there have been claims that EOS’s construction is extra akin to a distributed database fairly than a cryptographic protocol. Which means the community isn’t as decentralized as claimed.
“the EOS community just isn’t essentially a blockchain based mostly cryptocurrency community, however fairly a homogenous distributed database community that enables completely different person accounts to speak and work together by the distributed community database.”
Then in late 2019, EOS suffered congestion issues leading to sluggish transaction instances and excessive charges. Because of this, some accused it of being unfit for objective.
At across the similar time, on fees it had carried out an unregistered ICO, the SEC introduced settling with EOS for $24 million.
Briefly, EOS had had a torrid time since its record-breaking ICO three years in the past.
That is mirrored in its value efficiency, which signifies an absence of curiosity within the mission. April 2018 noticed EOS hit its all-time excessive of $22.71. Whereas there have been bouts of bullish value motion teasing the potential for re-reaching this stage, they’ve all petered out to date.
The likes of Cardano and Solana proceed hitting new all-time highs. However EOS is struggling to recapture its former glories.
What are the claims being made by Integra FEC?
Analysis carried out by Integra FEC, led by John Griffin of the College of Texas, factors to suspicious trades throughout EOS’s ICO. It’s alleged that these transactions could have been wash trades, between associates designed to pump the worth and draw unsuspecting traders in.
“The transactions, between probably related associates, “pumped up” the worth of EOS and induced unwitting traders to purchase the forex.”
Griffin expanded on this by saying it was a manipulation of the EOS providing value. The results of the suspicious transactions led to an inflated market worth of the token. In flip, this enticed others to take part.
There are 21 accounts recognized as being concerned with the observe described by Griffin. He estimates the “recycled funds” quantity to $815 million. However, the precise sums concerned might be considerably increased provided that different value manipulation strategies could have been employed.
No claims are made on who owns these accounts, and nor does Griffin allege Block.one was concerned.
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