EOS centralization is once again in the spotlight after the project recently posted the ruling from a dispute in which a user’s account credentials had been stolen in a phishing attack. In the report, the arbitrator ruled to reverse the account back to the original owner — a move that is garnering even more criticism against the fledgling blockchain.
The ruling is in reference to case number #ECAF00000023 on the EOS blockchain — in which a user’s account credentials and funds had been compromised as a result of a successful phishing attack.
EOS caught a lot of flack back in June when the user reported the attack to members of the EOS Core Arbititration Forum (ECAF), which ultimately led to the ECAF freezing funds on the account in question and forcing all block producers to comply by refusing to process transactions for that account — as well as six other accounts suspected of fraudulent activity.
ECAF claims that the owner was able to prove ownership of the original ERC-20 account by signing a memo specified by the forum.
As per EOS’s rules on arbitration, the arbitrator, case managers, and advisors were able to bill the user a total of just under 70 EOS, worth about $370, for their work on the case.
The Almighty Oligarchy
Since launching its genesis block in June of this year, EOS has come under fire a number of times in regards to its centralized model of governance. The EOS blockchain is governed by 21 Block Producers (BPs), which act as governing delegates voted by EOS token holders. Critics of this model claim that Block Producer majority collusion could be easily accomplished and would put the entire ecosystem in jeopardy. All EOS users must also follow a 19 article constitution, or risk account and funding forfeiture. In the case referenced above, the thieves broke Article III, which states:
While it can be argued that protecting its users is a primary goal for any blockchain, in this case, it is also defying immutability — the most basic characteristic of a true blockchain.
What are your thoughts on the EOS governance model? Do you believe they will be a successful blockchain in the future? Let us know if the comments below!
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Kyle Baird
Kyle migrated from the East Coast USA to South-East Asia after graduating from Pennsylvania's East Stroudsburg University with a Bachelor of Science degree in 2010. Following in the footsteps of his grandfather, Kyle got his start buying stocks and precious metals in his teens. This sparked his interest in learning and writing about cryptocurrencies. He started as a copywriter for Bitcoinist in 2016 before taking on an editor's role at BeInCrypto at the beginning of 2018.
Kyle migrated from the East Coast USA to South-East Asia after graduating from Pennsylvania's East Stroudsburg University with a Bachelor of Science degree in 2010. Following in the footsteps of his grandfather, Kyle got his start buying stocks and precious metals in his teens. This sparked his interest in learning and writing about cryptocurrencies. He started as a copywriter for Bitcoinist in 2016 before taking on an editor's role at BeInCrypto at the beginning of 2018.
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