Both are very important in the cryptocurrency world, thanks to their communities of users, developers and also because they allow the development of decentralised applications or DAPP.
Even though Ethereum and EOS are capable of smart contracts and DAPP’s they go about doing their role in two different ways, With Ethereum is a rental mode and EOS is an ownership model.
The Ethereum rental model
The arrival of Bitcoin has opened the gates for near-endless capabilities for the crypto world and the blockchain technology, but initially, the system was flawed and disruptive with slow transaction times and blockchain’s were dependent on miners for the creation of each block.
Then a 19-year-old Russian called Vitalik Buterrin built the first smart contract system called Ethereum.
Also see: The History of Ethereum
It was intended for Ethereum to become a supercomputer which rents its computational power.
Like most cryptocurrencies out there Ethereum was initially using a Proof of Work protocol, meaning that is was dependent on its miners and there has-rate, to create new blocks, the more miners there were, the more processing power was available and the faster the network became.
The update to Serenity underlined the switch from the Proof of Work protocol to the Proof of Stake protocol, an alternative method of creating blocks in a network where miners are switch with validators.
The validators must put a deposit or stake to participate in the process of creating a new block. If you would like to know more see our article Proof of Work v Proof of Stake.
The EOS ownership model
Instead, it to be a decentralised supercomputer like Ethereum it was desired to think EOS more like an operating system that can help developers to code DAPP’s on its system thus speeding up processing times.
By holding EOS tokens you are provided with an equivalent amount of CPU bandwidth and also processing power.
As opposed to Ethereum, EOS runs on a Delegated Proof of Stake protocol which implies a switch from miners to validators and supplying an alternative method of creating blocks, by staking an amount of EOS on the system.
The difference lies in the fact that each validator is chosen by a vote from a small group of people that owns EOS, on each round of voting there are created 21 block, 20 are made by the top validators and the 21st is made using a quasi-random selection algorithm that compares the staked amount with the time that amount has been staked.
When talking about the total amount of coins available we can see that Ethereum did not set a maximum limit for its supply raising concerns about inflation within the community, opposed to EOS where the total amount of coins available is 1 billion coins with an inflation rate up to 5% per year.
The two are different also when speaking about the total amount of time of generating blocks, where we can see that Ethereum blocks are created somewhere around 10 to 20 seconds whilst in EOS case it takes only 3 seconds for a block to be created.
Also, with regards to scalability, Ethereum can handle 15 up to 20 transactions per second and EOS can handle 3.996 transactions per second.
In conclusion, both Ethereum and EOS have evolved since they first appeared, being milestones when concerning the fact that they are offering endless possibilities of decentralised applications.
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