EOS is the native cryptocurrency that powers the blockchain protocol EOSIO, a network, and platform for the deployment of decentralized applications built on Ethereum. Unofficially EOS stands for ‘Ethereum Operating System’.
The protocol is a sidechain solution developed on top of the Ethereum network to overcome scalability issues. Sidechains allow developers to process transactions off-chain, only adding to the public ledger as needed, thereby avoiding the process bottlenecks. The smart contract platform claims to eliminate transaction fees and is capable of conducting millions of transactions per second.
EOSIO was developed by the private company block.one, which is registered in the Cayman Islands. Its first whitepaper was published in 2017, and its open-source software was released on June 1, 2018. It aims to be the first decentralized operating system that provides a development environment for decentralized applications (dApps) like BitShares, a decentralized cryptocurrency exchange (DEX), and Steemit, a social network with monetary incentives.
The EOS utility token is supported by wallets and exchanges that support the ERC-20 protocol (a series of functions and events that an Ethereum token contract has to implement). The blockchain platform’s constitution states that any EOSIO members who don’t use their EOS for three years could have their accounts terminated. Block.one says this measure is to encourage the platform to be used for its intended utility i.e. building dApps and communities by staking tokens for RAM, CPU, Network, and eventually storage.
Block.one’s software uses a decentralized consensus algorithm called Delegated Proof of Stake (DPOS). It was created by block.one’s co-founder Dan Larimer as an improvement to Bitcoin’s ‘Proof of Work’ system. DPOS uses less electricity, is faster, and is less centralized.
Dan was formerly a software engineer on America’s military-industrial complex working on defense projects such as drones and unmanned vehicles. After a crisis of conscience, he left to create systems that provide ‘life, liberty, and property for mankind.’ EOSIO is the third blockchain platform he has co-founded. Larimer developed the blockchain technology Graphene, and founded Steemit, a social network which uses blockchain technology to reward users. DPOS also has a number of applications and has been used in everything from Steem (the blockchain used by Steemit), EOS, List, Ark, and more.
Fellow co-founder Brendan Blumer began his journey into virtual assets aged 14, selling characters, magic weapons, and houses in online games such as Everquest and World of Warcraft. His first company, Gamecliff, created when he was fresh out of college, was acquired by Internet Gaming Entertainment (IGE) in 2005. Two years later he founded The Accounts Network, a company that sold in-game MMORPG avatars. In 2010, Blumer further launched Okay.com, an enterprise data sharing platform for real estate brokers in Asia.
In June 2017, EOSIO opened its initial coin offering (ICO), raising a record $4.1 billion in just one year making it the most successfully recorded ICO at the time. During this period, 1,000,000,000 EOS was distributed with 10% being withheld by block.one.
In 2018 block.one announced a partnership with blockchain veterans Michael Cao and Winnie Liu to form a new $200 million joint venture fund, EOS Global. The fund will make strategic investments in Asia-focused projects that utilize EOSIO.
In the same year, the company announced a number of other strategic partnerships including a $100 million joint venture fund with FINLAB AG, to support projects that stimulate EOSIO innovation in Europe. It also partnered with Galaxy Digital to deploy capital for future investments through it's $325 million EOSIO Ecosystem Fund and created a $50 million fund with TOMORROW BLOCKCHAIN OPPORTUNITIES.