How your EOS Tokens move from Ethereum to the EOS blockchain
A lot of people got confused by the EOS token crowdsale. It’s especially parts like this that make people scratch the back of their heads…
EOS TOKENS HAVE NO RIGHTS, USES OR ATTRIBUTES. The EOS Tokens do not have any rights, uses, purpose, attributes, functionalities or features, express or implied, including, without limitation, any uses, purpose, attributes, functionalities or features on the EOS Platform. Company does not guarantee and is not representing in any way to Buyer that the EOS Tokens have any rights, uses, purpose, attributes, functionalities or features.
Feel free to read the whole license agreement on the EOS website if you want to learn more. And just to be clear: This blogpost is not an investment advice but only a way to express my personal views on the EOS Tokens.
EOS.IO has made it very clear that they won’t launch a public blockchain. They only make the software and leave it up to block producers (BPs) to start a network using the EOS software. Currently these BPs can not start a public network as the software license doesn’t allow that without clear permission.
So the questions is; why? Why did BLOCK.ONE choose this road over starting their own chain? Well, it looks like this all comes down to legal issues.
The Securities and Exchange Commission is taking an interest in the hottest craze in cryptocurrency, the initial coin offering (ICO), and apparently the SEC is not into the hype.
This is probably also the reason why you can’t join the EOS Tokensale from the US. It looks like BLOCK.ONE saw this coming. So by stating that the token has no purpose and that BLOCK.ONE doesn’t guarantee anything they actually cover their asses in a legal way so to speak.
To cover my own legal ass here as well here I will talk about the technical part of the token. Can you do anything with it?? Well, the answer is yes. There’s a nice repo on the EOS GitHub which shows the way you can move your tokens from Ethereum to EOS. It is called GENESIS and will probably be part of the genesis block of a public EOS blocchain.
So moving your tokens from Ethereum to EOS probably comes down to using your private Ethereum key to claim the tokens on the EOS system. As your token balance is on EOS from the genesis block you can use them from the first seconds that EOS is “live”. And do they have any technical function?? Yes, you need some to create an account and you can stake them for storage or to help a certain dApp. EOS has a maximum inflation rate of 5% per year which means that 5% new tokens will be mined every year. So in the first year, when EOS has 1 billion tokens in circulation this might add up to 50 million tokens. Or almost 1 million new EOS tokens per week for the block producers. And as dApp-developers stake tokens to get resources they also vote for BPs which brings us great competition.
Forks and Airdrops
As BLOCK.ONE makes it very easy to create a genesis block using the Ethereum ICO-contract I expect several entities to start a public EOS blockchain. We’ll probably see things like “EOS Classic” or “EOS Dark” right from the start as many different groups have many different visions on how EOS should work. I don’t know if there’s anyway BLOCK.ONE can or will prevent this but owners of EOS tokens on Ethereum might have several “airdrop tokens” on different implementations of the EOS software right after the software becomes available on June 1, 2018. There will probably be just 1 “real” public chain which has 80% or more support from users. Just like there’s only 1 real Bitcoin blockchain at the moment.