EOS super node voting "hundreds of billions" of profits under the cryptocurrency war

The EOS super node voting has begun. If you are deeply involved in the cryptocurrency circle but don’t care, it may be that you haven’t figured out the accounts yet.

Apart from other things, the reason why there are so many "banker-level" players entering the election is because the 21 winners of this election can earn "huge" income every year.

As master nodes, they will receive most of the 5% annual increase in EOS revenue. Each node can receive approximately 2.38 million EOS in revenue each year. Based on the current price (EOS/RMB ￥44.2), a node can receive a reward of 100 million RMB per year .

If EOS really subverts ETH and even the entire blockchain ecosystem after its mainnet launch, and becomes the "100x coin" in the eyes of believers, then these 21 super nodes will share a huge fortune of nearly 210 billion RMB every year. What is even more surprising is that this is already a so-called "conservative" estimate. In the currency circle, there are many crazy supporters who believe that EOS will break through 1,000 US dollars in 2020.

Note that this is not about creating "billionaires", but about creating "billionaires who earn tens of billions every year". In addition, these super nodes will also have voting rights in the EOS ecosystem, which is equivalent to the "chief justice" who is above the president in the US system. No application in the entire EOS ecosystem can bypass their "ruling".

EOS is the sixth largest cryptocurrency in the world in terms of market capitalization. The main reason for its popularity is that its technological advancement has the potential to make it one of the most widely used main chains after Bitcoin and Ethereum. Many people in the cryptocurrency circle believe that EOS is the cryptocurrency with the most holders besides BTC and ETH. "In any forum or community, EOS discussions are the most active and have the most participants," an EOS supporter told BlockBeats.

Why does EOS need elections? This is related to the basic technology of EOS. You can simply understand EOS super nodes as super miners in the Bitcoin network. Their main job is to record and calculate all calculations in the EOS main network.

EOS concentrates computing power to a certain extent (in 21 super nodes), which enables EOS to have faster transaction speeds and greater fault tolerance than other public chains.

To some extent, the entire EOS network seems to be hosted on these nodes. If all super nodes and alternative nodes are destroyed, the EOS network will be paralyzed.

Therefore, it is not easy to become a "super node" or "witness node" in official terms.

According to the hardware threshold announced by the EOS team, to become a node, you need at least Amazon AWSEC 2 hosts x1.32x large, 128-core processor, 2TB memory, 2x1920GB SSD, and 25Gb bandwidth. The cost of a server alone is as high as RMB 759,000 per year . When the EOS-based DAPP is launched, the network bandwidth cost will also increase due to the increase in transaction volume.

To describe this EOS supernode election in more popular language, it is like a bidding for selecting a cloud service provider:

If EOS is a "website", it becomes a difficult problem whether this website should run on "Alibaba Cloud", "Tencent Cloud" or "Baidu Cloud". At this time, the website's developer (EOS community) initiated a vote to let all shareholders choose which cloud service to use.

Where there are interests, there will be people; where there are people, there will be the world of martial arts. This is the end of the popular science, and we will start with the real core of this article.

China vs the world

The election of EOS super nodes is different from the parliamentary system and is more like an American-style general election, but it is also different from the American general election and does not even have constituencies.

Any super node candidate can canvass for votes in any region. As an EOS holder, you can also vote for any super node candidate regardless of country or region.

But despite this, the national war began as soon as the campaign began.

According to data from Feixiaohao on March 24, the actual controllers of the top 10 exchanges with the largest EOS trading volume are Koreans, Americans and Chinese. Among them, Korean exchanges Bithumb and Upbit top the trading volume rankings.

In the EOS Masternode Election Report released by the EOSGo community on March 22, among the nodes that have met the election criteria, there are 8 Chinese nodes, 8 American nodes, 3 Korean nodes, and nodes from EOS communities in many other countries, totaling 35. In addition, there are 24 nodes that have not yet met the criteria.

It can be seen that although the transaction volume of EOS in China is not as large as that in South Korea, China does have the largest number of candidate nodes. South Korean candidate node EOSYS also described this phenomenon in an announcement published on steemit, and raised this situation to the level of competition between the Korean and Chinese blockchain industries, mentioning in the article:

Among the visitors to the EOS official website, Korean IP addresses account for the largest number.

South Korea has high trading volumes in all cryptocurrencies, but has almost no categories it can control.

The EOS trading volume of the Korean exchange Bit Humb is 34.78% of the total trading volume, while the EOS trading volume on Huobi, the largest exchange in China, only accounts for 13.15% of the total EOS trading volume.

In the last few paragraphs of the article, EOSYS concluded: If you don’t vote for us, South Korea will never be able to participate in the blockchain industry. If we lose, it means that Koreans did not use their voting rights "correctly".

This "If you don't vote, you're not a Korean" election manifesto, published 20 days ago, received 435 votes and 224 comments on Steemit, most of which were comments such as " Long live the Republic of Korea ."

In addition, South Korea’s third largest exchange COINONE Exchange and South Korea’s “Alipay” PayGate Payment have also been selected as super node candidates.

Nodes in China: OracleChain, EOS Shenzhen, ChainPool, InBlockchain, EosLaoMao, Eos Cannon, EOS Gravity, EOS UNION.

Among them, there are many people such as Lao Mao and Li Xiaolai who are responsible for or invest in it. Of course, there are also mining pools and alliances involved. In addition, the EOS Chinese community (EOS Fans) and HelloEOS also announced recently that they will submit their candidacy.

Among them, the node called EOS Cannon is very impressive. This node team was established in September last year, and the community admission standard is to have 50,000 EOS in the wallet.

Before the open node election, there was no information related to EOS Cannon in China, and the similarity in name to Canon cameras made it even more difficult to obtain information.

On the official website of EOS Cannon, we can see the real financial strength of this community: EOS Cannon community holds 60 million EOS Tokens . The total issuance of EOS Tokens is only 1 billion, with a circulation of 748 million. The number of votes of EOS Cannon has reached 8%.

Only 4.7% of the votes are needed to secure a node. EOS Cannon’s votes can not only ensure that you are selected, but you can also vote for another alliance node .

US Nodes: 8 eligible nodes, EOS Detroit, EOS Colorado, EOSSocal, EOS New York, EOS Oklahoma, Blockgenic, EOS SLC.

Take EOS New York as an example. It can be said to be an EOS community hand-picked by BM. BM often carries out activities in this community and has a very close relationship with them.

From the perspective of community recognition, the presence of Chinese nodes in the EOS community is far less than that of the United States and South Korea. Since the official Twitter account of EOS.IO was launched, it has never interacted with the EOS community in mainland China. The communities that have conducted activities and interactions with the official Twitter account of EOS.IO are shown in the figure below.

Comparing it with the world map above, we will find that the Chinese mainland is completely blank compared to other countries and regions.

Although Chinese developers are also working hard to develop DAPPs and conduct community promotion based on EOS, the official is even willing to forward content from the Kenyan community and is unwilling to interact with the Chinese community.

Or we can think of it this way: the international recognition of EOS developers in China is very low.

The EOS war between China, South Korea and the United States is about to break out.

Alliances and vote-buying are tricks the Chinese are good at

Koreans have the largest EOS trading volume, the Chinese have more compound assets (digital cryptocurrencies and fiat capital outside of EOS), and the United States has a seemingly neutral developer community and rule-making power.

On the surface, the final result may lead to a three-party check and balance, which is also the most ideal scenario in this ideal outcome - no one can do something "bad" to this decentralized network through complete control of the super nodes.

However, China’s advantage in the international market has never been just money, but “breaking the rules”, and this is no exception in the field of blockchain.

After being unsupported by the developer community and facing competition from South Korea, Chinese EOS supernode candidates have invented a new strategy: vote buying.

The so-called vote buying refers to returning the "huge salary" that should be received every year after being elected as a super node mentioned above to everyone who voted for him.

The voting for EOS master nodes is determined by the number of votes, which means that all candidates need to get as many votes as possible, either with capital support or with strong industry influence.

For example, Li Xiaolai's Coin Capital is the former. As an investor in EOS, he is bound to enjoy many rights and interests. Moreover, during the entire election process, Coin Capital was the one with the least publicity among the eight companies. On the other hand, Lao Mao's candidate node began to try to disrupt the political situation on the blockchain the day after the election was announced.

Lao Mao published an article on his official account titled "In the midst of the storm, I chose to be a super node" and began canvassing for votes. He will return node income, or dividends, to the big guys who support Lao Mao's nodes. A node can earn 2.38 million EOS per year, a good opportunity to make money without losing money, so of course, you should invest in it. As a result, everyone is optimistic about Lao Mao's node.

According to the political environment of the EOS community, this behavior of returning node profits can be considered as a form of vote buying.

A single stone stirs up a thousand waves, and other nodes have begun to imitate. EOS Alliance, EOSFans, and EOS Cannon have all clearly adopted the method of dividend distribution, while other nodes have adopted the ambiguous statement of "dividend distribution in accordance with the 'constitution'"?

On the surface, “vote buying” does not seem to bring any harm, but in fact it may lead to the collapse of the entire EOS.

As mentioned above, the election of EOS super nodes is like a bidding for a “cloud service provider”. We might as well continue to use this metaphor to describe the problems caused by “vote buying”, and there happened to be such a suitable example last year.

In March 2017, a local government's e-government system bidding notice showed that Tencent Cloud won the bid at a price of 0.1 yuan . This result attracted the attention of netizens and relevant departments.

Normal companies participate in bidding to make money, and the same is true for EOS super node owners to participate in the election. If the super node decides to give up the profits from being elected, this is not in line with economic common sense. Taking Tencent as an example, there are many points of public doubt, such as whether it involves behind-the-scenes transactions, whether there will be additional charges in future operations, whether it covets government resources or key data, etc.

Strategies such as "the dog pays for the wool, the pig pays for the bill" and "free is the most expensive" are common in classical Internet business. Once the bribed nodes are successfully elected, they will have enough ability and motivation to use the node advantages to obtain profits other than "legal remuneration", and the methods of obtaining them are often beyond our current prediction.

In addition to vote buying, BlockBeats also saw the following power distribution in EOS’s Chinese election nodes:

Seeing the capital competition from Chinese nodes, node teams in other countries could not sit still. In the EOS communities in South Korea and the United States, there were soon voices opposing the use of dividends to bribe voters.

The Korean node EOSYS has clearly stated that it does not support dividends. The US nodes are mainly EOS New York, which opposes the dividend canvassing during the master node election.

We can regard EOS New York as the base camp of EOS developers in the United States, and it is also a place that EOS founder BM often visits and mentions.

They said that it was a bit untenable, so they began to seek official support. After EOS New York took the initiative to communicate with Thomas Cox, Vice President of Product of Block.one, they received an official response: it is strictly forbidden for nodes to give kickbacks to voters when canvassing for votes and violators will be punished.

Soon, BM (Dan Larimer) came out and said that he did not support the practice of nodes distributing dividends to voters. This move triggered heated discussions on the Internet, which embarrassed the old cats. Thomas Cox also posted a post in the community titled "Why paid voting is bad" to condemn vote buying.

Early Thursday morning, Thomas Cox began publishing   The first clause of the EOS.IO version 0.1 "Constitution" is "Don't Tell Lies". The purpose of this clause is to stipulate that lying (such as publishing false or misleading statements) is a violation of the EOS.IO "Constitution" and to make this clause effective.

The clause details that if a person loses money or property due to lying, the victim can seek compensation from the beneficiary and the liar. The EOS.IO "Constitution" clause will be released continuously.

According to this clause, the behavior of Lao Mao and other nodes who exchange votes for cash back may have a negative impact after the super node voting is over. That is, if the project voted by EOS community members is not selected after the node voting, their remarks will be considered as lying and violate the EOS "Constitution".

However, referring to only one article for argumentation is not sufficient, and we need the complete version of the "Constitution" to make the final reference conclusion.

EOS election may eventually turn into a fork

Perhaps not many people are aware of this problem, but BlockBeats believes that EOS has encountered a huge challenge so far.

This challenge does not come from EOS technology, but from the fact that the countries and forces involved in EOS development, investment and ownership of EOS coins have not reached a consensus on the future of EOS.

As mentioned at the beginning, the best state for EOS super node elections is the compromise and balance of the existing forces, which is also the most stable structure in almost all political systems in the real world.

The top five exchanges for EOS transactions are Bithumb, Upbit, Bitfinex, ZB and Huobi. The first two are the two largest exchanges in South Korea, and Bitfinex has planned to develop EOSfinex, a decentralized exchange based on EOS.

It seems that 100% elections can be achieved by using exchanges as endorsements, but in the current election nodes, except for the CoinOne node in South Korea, there are no exchanges. If China's large exchanges start to enter the super node, then this conflict will become more intense.

The problems we are facing now may stem from an "accident" at the beginning of EOS crowdfunding.

In July 2017, when EOS crowdfunding started, Li Xiaolai, the earliest cryptocurrency tycoon in China, entered the market with a barrage of praise. This praise almost became the biggest point of controversy after EOS.

Today, the Chinese teams that claim to be "completely optimistic about EOS" and are willing to give up "super node profits" may be another blow to EOS.

Considering the current attitude of the EOS developer community and the personality of founder BM, if a Chinese node is successfully elected as a super node by breaking the rules, BM may give up the subsequent development of EOS. At that time, EOS may be reduced from "the most promising public chain" to "air coin controlled by bankers".

If Chinese "bankers" control EOS nodes, it may cause Korean hot money to withdraw from the EOS market, causing EOS Token to lose more than 50% of its trading volume.

In the foreseeable future, EOS may become the next BTC/BCH due to real conflicts of interest .

If one of the forces wins the election with overwhelming strength, the possible result may be similar to the ETH/ETC fork: EOS led by the winner will become a more recognized main chain, while the original chain insisted by the loser will become a virtual currency.

But in fact, as analyzed above, due to the conflict between the EOS developer community and large coin holders and large computing power owners, the future fork of EOS may lead to a fork similar to the one between BTC/BCH.

Maybe yes. In the field of digital cryptocurrency, similar forks caused by real power disputes have occurred more than once.

In 2016, in order to solve the long-standing Bitcoin expansion problem, Bitmain CEO Wu Jihan and the Bitcoin Core Development Team had a disagreement. The two sides tried to reach a settlement and compromise in Hong Kong but failed.

A year later, Wu Jihan invited representatives from 58 companies in 22 countries to attend the meeting and privately negotiated plans for Bitcoin expansion and forking. The Core development team representatives were blocked outside the hotel and were not allowed to attend the meeting.

In an interview with Caijing magazine, Samson Mow, chief strategy officer of the Core team, commented, “They just want to compromise with each other and don’t want developers to get involved because if developers get involved, they won’t be able to reach a consensus.”

The "they" here refers to the "Wu Jihans" who only care about commercial interests, while the "developers" refer to the technicians who provide technical maintenance for Bitcoin.

Perhaps, this will soon be the problem facing EOS.