EOS ICO analysis | RoI and Price volume analysis

Top Fundraiser EOS ICO faces collusion allegations

The highest record earning project, EOS is now facing speculations of being a scam since the leaking of a spreadsheet by Shi Feifei, a Huobi employee.

Everything about EOS

EOS is a decentralized project in the blockchain space that aims to radically improve what is already on the market. The decentralized operating system intends to provide an easy alternative for all the developers to design a dApp.

EOS became the talk of the town soon as they launched their ICO by announcing that they will be raising funds over a period of a whole year while most other ICOs aim to finish their sale as soon as possible. The objectives behind this strategy were (according to EOS)

1. To stabilize the price.
2. To gain confidence among investors by pumping out updates, info, and news about the project at regular intervals.
3. To gain as much recognition as possible.

This turned out to be a marketing masterstroke for EOS as they ended up raising $4 billion (highest till date) for their project.

The real story behind EOS and Huobi scam

EOS is a blockchain based project and Huobi is an exchange platform. If blockchain based project colludes with an exchange it can lead to adverse conclusions.

The weak official response by EOS to these allegations of collusion doesn’t instill much as to build confidence over the project. Also, Huobi’s statement denying having financial dealings with other EOS nodes is not good enough as it doesn’t explicitly rule out the authenticity of the leaked spreadsheet.

According to TrustNodes, a spreadsheet has been leaked, allegedly authored by Shi Feifei, a Huobi employee. Titled “Huobi Pool Node Account Data 20180911,” the document purportedly shows that Huobi voted for 20 block producers (bps) and in return 16 voted for Huobi.

Huobi is also alleged to control five nodes. The table below shows four of those nodes in grey (eoshuobipool being the fifth).

Leaked spreadsheet

What’s the outrage all about?

EOS raised funds by leveraging the values of decentralization when crypto investors were losing faith in centralization and when Bitcoin was booming. Now the speculations around the possible centralizing influence of exchanges have become significant since the EOS network went live in June and voting for block producers began.

EOS strongly claims to be decentralized but the fact of having just 21 super node bps that verify blocks in EOS’s delegated proof-of-stake (dPoS), says a different story. Concentrating information among just 21 nodes constitutes to be a centralized blockchain which completely contradicts their ideology behind the project.

EOS has missed the mark again and again by not being able to establish a voting system that makes sense and builds trust among investors.

Certainly when 12 of the total 21 crypto platform’s (nodes) of EOS are stationed in China. Given the circumstances, its only fair for investors to have doubts about the possible integrity breaches of the system.

Evolution of blockchain and cryptocurrency was a result of a loss in faith in the conventional banking system and if at all EOS turns out to be a scam it could be a huge blow to the crypto industry on the whole as people will start losing faith in the blockchain technology as well.

It doesn’t matter if EOS is a scam since the idea of using Blockchain technology and creating decentralized platforms was supposed to enable new levels of trust which in this case is a terrible fail.

Returns on Investment overview

EOS saw hit its all-time in the Last week of April 2018 at 1775.90%. It also witnessed an all-time-low in its RoI at -44% during the third week of October 2017. However, since then the ROI trend has been facing bear market for the past 6 months.

Source: InWara’s database

EOS has seen a relatively smaller dip from its last peak point in April, 2018 surrendering 82% of its total RoI value compared to the broader blockchain market that surrendered 94% in the same period.

EOS is still one of the top 5 cryptocurrencies in terms of total market capitalization with a value of over $2.8 billion giving over 300% returns on investment(as of 27th Nov, 2018).

Average RoI of Blockchain sector (source: InWara’s database)

To sum it up

This turn of events in EOS project has created a sense of doubt and awareness in every individual as well as institution looking to invest in cryptocurrency.

This is another classic example to justify the statement that the process of analyzing an ICO is not done even after investing. It’s vital to stay updated about the progress of the project and the market fluctuations.

InWara is one such specialized platform dedicated to ICOs. InWara’s database allows you to access real stories on companies behind ICOs. Keeps you updated about the latest developments in the ICO industry.

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