EOS vs. Ethereum - Which Сoin is More Promising?

  • George Shnurenko
    ⭐ Features

    EOS and Ethereum are both promising platforms, but there are key differences to consider before investing


EOS vs. Ethereum - Which Сoin is More Promising?

Both EOS and Ethereum cryptocurrencies are predicted to be among the top three coins of the future, but which one is better? Let’s figure out how these cryptocurrencies and underlying Blockchain technologies differ.

The days of ultimate Bitcoin’s reigning are over, and new altcoins are competing for the top of the market cap. EOS and Ethereum are among the most promising of them. Let’s underline the difference EOS vs Ethereum and figure out which currency is better.

What is Ethereum?

Being introduced by Russian-Canadian developer Vitalik Buterin, Ethereum is a modern Blockchain that’s way more technologically advanced than the Blockchain underlying Bitcoin. It features a faster transaction processing speed and is Turing-complete, which means it allows for smart contract implementation. When the concept of Ethereum appeared, it didn’t gain much traction right from the start. However, after the release of the white paper, people recognized the potential of this Blockchain and started investing heavily and mining the coin.

Ethereum addressed the problems of slow transaction processing speed and some safety issues. Besides, it’s one of the first platforms for running decentralized applications (DAPPs) that can function exactly as programmed and won’t be interfered with by third parties. At the moment, Ethereum’s market cap is about $30 bln– it’s the second cryptocurrency after Bitcoin.

What is EOS?

In 2017, Block.One company announced the public sale of EOS coin and release of an EOS Blockchain operating system that allows for:

  • database storage and development

  • authentication

  • scheduling

  • communication with app developers via Internet applications

  • other features

It provides users with the whole gamut of tools for applications and ensures horizontal and vertical scalability. Why EOS is better than Ethereum? Some people kid that EOS stands for “Ethereum on Steroids” because it’s a better version of ETH Blockchain. EOS uses parallelization and allows for over 50,000 transactions a second with less than 200 milliseconds required for the transaction.

On the contrary with Ethereum, EOS has gained momentum right away – although the product hasn’t been launched fully, millions of tokens have already been sold, and the price of EOS coin has soared from initial $0.77 to $12 in May 2018.

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Detailed comparison Ethereum vs. EOS

Although technological ideas underlying EOS and Ethereum seem to be the same, there’s a dramatic difference between EOS coin vs Ethereum. Let’s underline them:

Ethereum

EOS

Based on Proof-of-Work protocol with the transition to Proof-of-Stake

Delegated proof-of-stake (DPoS) protocol that solves some of Ethereum’s bottlenecks

Fees are taken for transactions which can be costly for corporate users and large organizations

No fees for transactions which makes EOS highly attractive for both individual and corporate users

Limited by the single-threaded performance of CPU

Allows for up to 100,000 transactions per second on a single thread

Denial-of-service attacks and flood of transactions can break down the entire network

An attack cannot freeze the entire system, and users are guaranteed to enjoy enough computational power

Rental economics model. Fees are required for calculations, storage and bandwidth use. The fees fluctuate and can get significantly higher for some transactions. Gas fees are burned throughout the process of development.

Ownership economics model. Owners of EOS tokens can get their share of storage, bandwidth and computational power. The network is predictable and reliable. No fees for transactions and data processing.

Ethereum platform doesn’t provide use cases and extra features – users can create sub-protocols inside the contracts.

There won’t be such phenomenon as EOS platform. Instead, the developers will use toolkits and instruments provided with self-describing interfaces and database schemes.

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The design philosophy of EOS and Ethereum

Does the technical superiority of the second Blockchain mean that EOS better than Ethereum? It’s hard to say for sure. The design philosophy varies dramatically, which means they can be applied a bit differently.

The Ethereum platform is application-agnostic, which means it’s a neutral ecosystem for the creation of different potential applications. It doesn’t provide any specific features, but that reduces bloat in applications. Therefore, Ethereum is perfect for those who simply need its basic code as a foundation and are ready to complement it (which is pretty challenging from a technological standpoint).

EOS creators do recognize that there are many applications that require the same kinds of functionality, and they provide different cryptography implementations as well as app/Blockchain communication instruments. The role-based permissions, rich toolkits for interface developments and database schemes are efficient for simplifying management and avoiding security issues.

A few words about mining

There’s one more significant difference between Ethereum and EOS – mining. In EOS infrastructure, the miner is called “block producer”. This person is incentivized to create blocks for the block rewards (amount of tokens for performed calculations). In Bitcoin and Ethereum, it works pretty much the same way, but while such miners increase transaction fees to make more money, how would EOS miners be motivated, if there are no transaction fees?

By voting. The block producers are voted by token holders, and the voting power is based on the number of tokens possessed. A token holder tries to perform as well as possible to get a decent payment for his work (EOS offers initial five percent annual inflation) and sustain perfect reputation.

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The bottom line

Answering the question “Is EOS better than Ethereum?” we should consider one important thing: both Blockchain platforms have a lot of potential and there’s no certain leader yet. Therefore, if you want to invest in this or that coin, they’re both worth consideration.

Ethereum has reached the average price of $500-600 in 2018, and predictions concerning its growth are positive: it’s expected to hold a huge piece of the market cap in the following years. Meanwhile, the initiative by Block.One with EOS as the key token hasn’t been fully launched yet, and only time will show whether the coin and project justify the hype rising around them. Now, EOS currency costs around $12, and its price is expected to grow moderately reaching $30 in 2019 and $150 after 2023.

Therefore, your choice should depend on the investment policy you prefer. If you’re ready for long-term investments with slow but steady growth, try EOS. Ethereum investors have already managed to reap a considerable income from currency value soaring to $1,200 in the last year. However, the predictions about Ethereum price are vague.

Cover image via u.today
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