After comparing IOST and Ethereum we now proceed to compare and contrast IOST and EOS. Unlike Ethereum, IOST and EOS are high-performance blockchains with several times more transaction bandwidth, the former achieving 8,000 Transactions per second (TPS) on public testnets and the latter 4,000 TPS during its mainnet launch. Leveraging a more scalable consensus mechanism, both of these blockchains are expected to continue to push the envelope of blockchain technology. IOST plans to achieve 100,000 TPS with sharding technology research and EOS will release EOSIO 2.0 which it says is around 4-16x faster.
Both Scalable and Feeless
It is instantly apparent that both IOST and EOS are built for scalability, a feature that Ethereum is struggling to achieve. Unfortunately, there have not been any relevant decentralized applications that could test the very limits of these two contenders. Perhaps the launch of EIDOS demonstrated the high capacity of EOS but it also highlighted a very serious design challenge that we will discuss later on in this article. The only time we saw a glimpse of IOST’s potential was during its first weeks after its mainnet release. Endless Game saw Transaction volumes exceeding 700 million IOST within the first day of launch.
We can, therefore, conclude that as far as scalability is concerned both blockchains have no problem accommodating the different decentralized applications requiring high bandwidth and throughput. DApps developers who want to leverage the power of blockchain technology would find these two blockchains very attractive. Moreover, transactions on IOST and EOS are in essence feeless, IOST through its implementation of iGas as well as EOS as it uses an OS-like resource allocation model (CPU, NETWORK and RAM) for transactions.
Decentralization is the primary characteristic of blockchain technology that makes them so revolutionary. Without it, we cannot really differentiate blockchains to the ordinary database or spreadsheets we have today. Decentralization means there will be no reliance on any centralized authority or intermediary to establish trust. However, achieving consensus in a decentralized manner is very challenging, scaling it is even harder. Bitcoin and Ethereum use the Proof-of-Work consensus algorithm to achieve decentralization and is considered the gold standard for all consensus mechanisms.
PoW is a proven consensus mechanism for blockchain but it is not the most cost-efficient and definitely not scalable at its current form. This is why the leading smart contract platform, Ethereum plans to migrate to Proof-of-Stake (PoS) with sharding technology to scale up its capacity. EOS and IOST consensus mechanisms are variants of PoS consensus protocol; Delegated Proof-of-Stake and Proof-of-Believability (PoB) respectively. The main challenge in these types of consensus protocols is the degree of their decentralization.
EOS’ DPoS consensus mechanism has been criticized to be too centralized owing to the fact that only the top 21 elected Block Producers (BPs) are engaged in block production and transaction validations. While some BPs get replaced from time to time the majority of them remain essentially in the top 21 rank. IOST, on the other hand, uses Proof-of-Believability which utilizes a randomizing mechanism dubbed as Servi that allows the randomization of its Block Producers. This ensures that a more decentralized consensus participation is attained in IOST.
A blockchain is only as secure as the amount of decentralization it has. This will reduce the possibility of coercion among participants to attack the network. This is the same with all consensus mechanisms including those used by bitcoin and ethereum. Comparing IOST and EOS we can say that IOST has a higher degree of decentralization and thus having a slimmer chance of coercion which may lead to a network attack. Both of the consensus mechanisms of IOST and EOS allow all participants to vote who will participate in blockchain production and validations which both claim to be a more democratic method of consensus participation.
Proof-of-Stake (POS) type consensus mechanism has been gaining much ground in the cryptocurrency space. They cost less in terms of infrastructure investments needed and more importantly, it does not consume a ridiculously large amount of energy which can be of better use elsewhere. As proof, the second most famous cryptocurrency and second largest in terms of market capitalization, Ethereum, plans to migrate to this consensus protocol which is a clear seal of approval from Ethereum developers.
Developers Tools and Support
IOST and EOS are doing well in terms of giving its developers the right tools and support. It can be said that both teams understand the importance of giving its developers the right kind of tools and support in order for them to create compelling, engaging and relevant decentralized applications that would demonstrate the power of their blockchain technology. In recent weeks the company behind EOSIO has been releasing more information about its upcoming protocol upgrade, EOS 2.0, which according to them is 4-16x faster and even more developer-friendly development tools.
Since the very beginning, IOST has been building an ultra-fast blockchain that can compete with other high-performance blockchains. Like EOS, IOST offers a very scalable blockchain with a smart contract platform that supports general-purpose programming languages. However, IOST has a very different resource allocation model than EOS. We believe that this resource allocation model gives a significant advantage to IOST, as IOST users and developers are not subjected to the oftentimes erratic resource availability in the network like what happened to EOS when EIDOS launched last November 2019.
The severe resource scarcity that happened after the release of EIDOS and subsequent resource availability problem proves what IOST developers have been warning us before. They pointed out that with their current model the resource availability is too volatile and complicated. People with a modest amount of EOS staked found themselves unable to use and interact with the EOSIO network. This resulted in a massive decline of EOS-based Dapps users and the migration of some of the more popular DApps from the EOS main network into some of the more resource-friendly EOS-based sidechains.
We believe that by offering users and its developer a simpler and more stable resource allocation IOST has a superior model. IOST simplified the resource model by combining CPU and Network resources together calling it iGas. Moreover, Instead of allowing resources to be rented out IOST gives its users iGas which regenerates every 24 hours. The amount of iGas distributed to IOST holders depends on the IOST they have staked. Lastly, iGas is not tradeable hence it is not subject to resource availability uncertainties.
DApps (Decentralized Applications)
Dapp.com, a DApps data aggregator site gave us a clear picture of IOST and EOS DApps landscape. While both of them paled in comparison with Ethereum, EOS has a significant lead on all essential and relevant dapps metrics compared to IOST. It was revealed that in 2019 EOS has around 493 Dapps more than ten times the number of Dapps that was built on IOST with numbers at 38. EOS also fared better in terms of Active users perhaps a result of having more than 10 times the number of DApps compared to IOST. Dapp.com shared that EOS has around 518,884 active users while IOST has around only 27,871.
EOS also dominates IOST in terms of DApps transaction volume having around 2.81B transactions while IOST has only 47.10M. However, it must be noted that this transaction included EIDOS Airdrop transactions which have taken much of the CPU-time resources of EOS. In terms of USD EOS still dominates IOST with over $4.98B worth of EOS transacted against IOST’s $114.34M. This means that for IOST to compete with EOS it needs to attract more DApp developers and with the current resource allocation model on EOS IOST can exploit this opportunity to onboard those displaced by this design weakness.
IOST gained an upper hand in one or two technological aspects. First, for a higher degree of decentralization of consensus mechanism and second, for a better resource allocation management model. Everything else remains virtually the same as both offers a highly scalable blockchain that is both secure and decentralized. However, IOST falls short in terms of blockchain developers using their platform. Compared to EOS there were around 260 dapps that were released in 2019 compared to only 38 dapps on IOST.
The prevailing resource uncertainty on EOS should signal an opportunity for IOST to attract high-profile projects from EOS to its own blockchain. While this might be a great opportunity it must be noted that there are many EOS-based sidechain alternatives that require little to no additional development to migrate into which does not have the same design weakness as the EOS main network. Nonetheless, they are relatively smaller blockchains with significantly lower resources compared to IOST which can give them better support throughout the development life cycle.
EOS is a $4.1 billion blockchain project and led by one of the brightest minds in the whole cryptocurrency industry. The amount raised during its year-long ICO just proves its potential and the level of confidence of investors in the project. But the project seems to be caught flat-footed in dealing with a potentially disastrous design weakness, It seems that so long as the top 21 BP are earning from consensus participation and many big holders earning from the resource exchange (REX ) they care less if ordinary users are unable to use EOS network or dapps developers leaving.
This scenario will not happen to IOST as consensus committee members are often rotated and there is no REX. This means that it is highly unlikely that any resource availability uncertainty will ever happen in IOST. The failure of EOS to address this concern in a timely fashion is solid proof that indeed EOS is highly centralized. This stems from the fact that the 21 BP committee members hardly ever change, creating a cartel-like environment in their ecosystem. No such event could happen in IOST as it uses the Proof-of-Believability (PoB) consensus mechanism which exactly addresses this potential problem by randomizing members each round.
- IOST to Lead the Digital Currency Transformation October 19, 2020
- Interview with RAMP DeFI’s CEO Lawrence Lim October 12, 2020
- Building on IOST with IOST .NET SDK by Sonata September 8, 2020
- Recap of IOST AMA with Aegis CTO Christopher Holm September 1, 2020
- IOST Blockchain ranked Top 3 in CCID latest Index August 26, 2020