Thoughts on EOS

I took a look at the EOS project for a friend. This largely consisted of reading most of the whitepaper and some experiences I’ve had interacting around people endorsing this altcoin. My overall assessment was not positive. This doesn’t mean the project will not succeed but rather that I do not picture this project being a serious contender among stronger ones in the smart-contract space. Plenty of weak projects fail to die off but never really thrive, like MaidSafeCoin for distributed file storage. These were a non-exhaustive list of concerns I shared in a conversation:

1. No PoW component to block generation. There is no way to definitively choose between two competing forks. This is something is has been studied academically tmk and I agree with this assessment.
2. Solely PoS-based. This is a bad idea for a number of reasons, one of which being the bootstrapping problem. With PoS-based, only people who start with money continue to make money, so you can’t evenly distribute funds appropriately. Ripple has this problem as well and it has been a huge thorn in their sides. Giveaways are gamed by scammers. Buying tokens is not a particularly wide distribution. The way to do this properly is to start with PoW and then transition to PoS. That this very obvious engineering solution was not pursued gives me serious concern. If there were clear technical reasons for this, this absolutely needs to be discussed in the whitepaper rigorously.
3. From an engineering standpoint, their whitepaper is not great. They do explain why they chose certain technical decisions over similar ones, like dPoS vs. hybrid PoS/PoS that would seem more appropriate. They do not have any formal security or performance guarantees anywhere. They sort of just say “it’ll be hard to cheat the system because transactions refer to recently mined blocks” and I’m left wondering why they think they know what they’re talking about if they offer only a qualitative justification. To get a sense of the kind of rigor I am talking about see https://eprint.iacr.org/2014/452.pdf. (Proof of activity is hybrid PoW/PoS.)
4. They give too little attention to engineering considerations in lieu of how the design appeals to business applications. Attention is not mutually exclusive but the bottleneck to these projects succeeding or dying almost entirely comes down to the engineering. That they gave the engineering side so little consideration but put in effort to understanding how to design it for business applications just tells me that they very much undervalue the importance of the design of the system. As I mentioned, mentioning the design of the system is not enough. Very similar design choices that were not pursued need to be mentioned and these choices need to be justified with mathematical guarantees about the performance/reliability/security of the system. I get the sense that they did not think things through very thoroughly by comparison to the strong engineering teams I am familiar with.
5. The seem to have the wrong priorities in their engineering. I am left wondering why they seem to want to design their system to deal with parallel processing which I have never heard of as being a real problem in smart contract platforms. Meanwhile, the most important topic in smart contract platforms, security, is barely touched on.
6. The kinds of attacks that could feasibly carried out are not discussed. This relates to security. Their design is different enough from existing projects to warrant this.
7. EOS seems massively overvalued. This project was made public in July. It is valued at more than $500M today. I have heard so little of this platform and it is so new that I doubt they have many smart contracts built on their platform at this point. This valuation is completely inappropriate imo. I am not even sure if their project is fully built as to my knowledge ETH tokens were sold which would later be exchanged for the real project tokens. I could be wrong on that though.
8. Too much hype from supporters. Smart contract platforms seem to appeal the average crypto enthusiast the best. As soon as a new smart contract platform is announced its valuation spikes to the hundreds of millions of dollars even if it has no minimum viable product. (e.g. QTUM). For this reason I think it is fair to say that smart contract platforms attract some of the most dumb money (along with ICOs). From what I have seen, the really good projects usually fly under the radar and gather a smaller community of domain experts who recognize the project as an appropriate solution. Then when these projects already become mature years later, that’s when everybody else is like “oh shit this is a good idea”. That I am seeing communities of people who do not impress me with their depth of thought and seem to completely lack domain expertise suggests that EOS does not fit this profile.