The prominent blockchains, Ethereum and Bitcoin, can not handle several transactions simultaneously. Consequently, users must wait and pay higher fees to process their transactions. Such roadblocks in the still-growing market can be a drawback and scare away potential investors, making the entire system impractical. Often referred to as the killer of the most popular smart contract blockchain, Ethereum, the EOS blockchain offers much more than the earlier cryptocurrencies. 

What is EOS?

Electro-Optical System, commonly known as EOS, is a blockchain-based architecture to develop, host, and run decentralized applications. It has emerged as a popular name in blockchain technology, per the current trends, and can be favorable for firms desiring to meet imperative business needs. It offers an operating system that simplifies the dApps development process and intends to be more versatile and scalable.

The co-founder of Steemit and BitShares, Dan Larimer, developed and officially launched the EOS crypto in 2018. He announced the project in 2017 and began the Initial Coin Offering (ICO) the same year. EOS is known for having a record-breaking ICO duration of almost one year and accumulating over $4 billion in investments during that period. It has a market cap of approximately $1 billion at present.

Suppose you are at a coffee shop to place your order. When it is your turn, you give the order and decide to pay with cryptocurrencies. However, your transaction stays pending due to the heavy traffic on the blockchain platform. Now you can’t keep waiting in line for 20 minutes for a single cup of coffee, right? EOS addresses the need for faster processing time and rules out such issues. Its characteristics include:

  1. Fuels time management through asynchronous communication
  2. Eliminates transaction fees
  3. Reduces program load with multi-processing and parallel processing
  4. Enables alteration, modifications, and improvement in codes

EOS blockchain provides the best of both worlds as it combines the smart contract usability of Ethereum with the high throughput of Graphene and BitShares. It comes with in-built features like role-based permission systems and a web toolkit, making it a convenient alternative for developers.

EOS leverages vertical and horizontal scaling to offer free applications to users. It puts forward a secure and faster platform to deliver various web services, like Cloud storage dApps, EOS smart contracts, User authentication, etc.

How EOS blockchain works?

EOS blockchain resembles the performance of a real computer and uses some familiar computing concepts. It collaborates within a distributed database structure to enable the deployment of high-speed blockchain apps for industrial use.

EOS works the same as Ethereum and involves robust blockchain technology. Blockchains typically employ a proof-of-work consensus mechanism that requires miners or users to solve cryptographic puzzles to mine a block they want to add to the blockchain.

However, EOS accompanies a relatively new system to enhance security and reliability. The following elements power the EOS and accelerate its working procedure:

1. Smart contracts

Smart contracts are protocols that digitally verify, enforce, and expedite contract validity. They do not require third parties to perform transactions. EOS leverages smart contacts to constantly record, store, and sync the action events in the blockchain.

2. DPoS

Proof-of-Work procedure asks for immense computational usage and energy. But EOS uses Delegated Proof-of-Stake for its consensus. It implies that anyone with tokens in the EOS software can choose the block producers via a continuous approval voting system. Those who partake in the producer election receive an opportunity to produce blocks equivalent to the votes they get. The DPoS system confirms a transaction within 1.5 seconds, aiding in several action processes concurrently.

3. Ownership model

The holders can stake or lock their tokens to partake in several processes. They can vote and make decisions regarding software rules or participate in the validation process. One can use these EOS tokens for transacting on the platform.

4. Parallel and sequential performance

dApps on EOS distribute workloads on the platform and deliver parallel processing to save time. It allows multiple actions in a sequence to prevent double-cost errors.

Technical features

EOS is comparatively less energy-intensive and offers a wide range of user-friendly and business-friendly features. Apps deployed with EOS development are upgradeable and enable users to access code fixes, alter application logic, update the app, and modify it. The notable features of the EOS cryptocurrency include:

1. Scalability

Scalability is the biggest issue in the blockchain industry. While renowned crypto Bitcoin manages 3-4 transactions per second, the EOS blockchain can compute millions of transactions every second without additional charge with its Distributed Proof-Of-Stake (DPoS). 

2. Flexibility

Ethereum blockchain platform encountered a setback due to a Decentralized Autonomous Organization (DAO) attack, leading to two distinct blockchains with their own cryptocurrency. EOS uses DPOS, which makes it unlikely to come across such a threat. The elected block producers can freeze the faulty dApp until it works fine.

3. Usability

EOS consists of various usability features that power up the app development. EOS crypto brings a declarative permission scheme, self-describing interfaces, and database schemes to simplify the developer’s work.

4. Governance

EOS maintains governance by establishing jurisdiction and choice of law besides other mutually accepted rules. Every transaction requires the hash of the constitution in the signature, which binds the users to its laws. Block producers can amend the protocols and the legally binding guidelines. Any node that does not adhere to the modified protocol is shut down.

5. Self-sufficiency

EOS-based blockchains generate a 5% natural inflation yearly. All the block producers receive it in addition to their confirmation of transactions. It ensures that a blockchain is not reliant on a single foundation, individual, or organization for development, growth, and maintenance.

The cost of building an app on EOS

The global dApp market is estimated to reach $368.2 billion by 2027, given the benefits dApps provide compared to traditional applications. The EOS ecosystem furnishes a faster, more convenient, and more suitable platform for decentralized applications. Besides, it demands no commissions! 

A dApp on EOS does not have a fixed development cost. It invariably depends on three factors:

1. Resource type

There are primarily three kinds of resources in dApps-

  1. RAM: State storage
  2. CPU: Computation and computational backlog
  3. Network: Bandwidth and log storage

2. Resource usage

The kinds of resources and their usage grossly influence the development cost:

  1. RAM: Blockchain state storage comprises the information users can access from application logic, such as account balances and order books.
  2. CPU bandwidth: Every time a user sends a transaction, the action temporarily consumes CPU bandwidth. You can calculate it as the average consumption in microseconds over the previous three days.
  3. Network bandwidth: Sending transactions utilizes a few units of network bandwidth. Average consumption in bytes over the last three days calculates and presents the network bandwidth.

3. Resource allocation

Resource allocation significantly affects the cost of creating a dApp on EOS:

  1. RAM: Users purchase RAM from the marketplace following the Bancor algorithm. It underlines an autonomous liquidity mechanism and sets determined prices for tokens on smart contract blockchains.
  2. CPU and Network: Users gain CPU and network bandwidth depending on the number of tokens they hold in a 3-day staking contract.

In addition, multiple elements also influence the cost of developing an application on EOS, including the niche, UI/UX design, among others. That said, the average cost of building a dApp on EOS is approximately 21,000 EOS coins.

Now, what is an EOS coin? EOS coins are the tokens of the EOSIO network, an open-source blockchain technology. They are one of the several cryptocurrencies that run on the platform.