EOS Block Producer Allows Loss of $27,500 Because They
cryptocurrency-event-2018

EOS Block Producer Allows Loss of $27,500 EOS Because They “Had Something Else To Do”

The EOS community was rattled this morning after a block producer failed to comply with an order from the community. The block producer, when pressed for questioning, claims to have ignored the order because they had “something else to do”.

The issue caused a double spend error on the EOS network, causing a single user to lose over $27,500 worth of EOS tokens.

Keep in mind that EOS block producers earn $10,000 USD worth of EOS every day. In other words, this block producer had something more important than earning $10,000 per day in exchange for securing one of the largest decentralized networks on the planet.

Obviously, EOS is still in its infancy and the network will inevitably have growing pains. Figuring out the block producer voting system is one such growing pain.

Nevertheless, the block producer may be in big trouble: after the block producer failed to comply with the ECAF order, that BP may be facing a lawsuit.

What Happened?

EOS is governed by two core units. First, there are 21 block producers (BPs). Second, there’s the greater EOS community that works as part of the EOS Core Arbitration Forum (ECAF).

In this latest incident (aside from the EOS BP's freezing 27 accounts), a block producer failed to comply with an ECAF order to update their config. The order required the block producer to block 1 account. All the BP had to do was update their config and the account would have been frozen.

Instead, the block producer claims they never received the list:

“because they had something else to do”

Understandably, the EOS community is not taking kindly to this excuse – especially given that block producers are paid $10,000 per day in EOS.

This is when disaster struck. Because one block producer failed to update their config, one user (under the ID guzdonzugmge) lost 3,570 EOS, or about $27,500.

This whole story comes from a screenshot posted to Twitter and then later to Reddit. The conversation is purportedly between the block producer, EosStore, and a member of the crypto community, Daz.

Nobody has verified the authenticity of the screenshot, so it’s not 100% clear that the conversation really involves a member from the BP EosStore.

In any case, EOS is plummeting on the news. The currency is down over 7% over the last 24 hours, although it still sits in the number 5 position in terms of overall market cap, trailing just bitcoin, Ethereum, Ripple, and Bitcoin Cash.

What Will Happen Next?

To some critics, this is the beginning of the end of the EOS platform.

To supporters, this is just one of the growing pains that needs to be solved if EOS is to be successful in building the world’s biggest decentralized bank.

Statement of Updating the Blacklist from ECAF from eos

Earlier today, the block producer responsible for the mistake (EosStore) made a statement on the r/eos subreddit expressing its regret for the fiasco. That block producer further stated that if the community and other block producers can unanimously agree that ECAF should be held responsible for the loss, then it will compensate the affected amount (the 3,570 EOS lost by the one user).

EosStore also encouraged users to “co-develop a software providing publishing platform for ECAF arbitration orders” to prevent mishaps in the future.

Nevertheless, the responses to that post were less than friendly. One user criticized the over-centralization of the EOS network, stating, “You didn’t want to comply with the order”.

Others pointed out the problem with the fact that a single mistake like this can lead to enormous losses:

This concern was repeated across the ecosystem, although some users blamed the EOS network and not the block producer itself:

Meanwhile, replies on the r/cryptocurrency post discussing the issue were decidedly less friendly.

“’You didn't want to comply with the order.’ And therein lies the issue. Block producers control all decisions made on EOS, from validating blocks to seizing funds from under your private key…. The richest wallets are in complete control of EOS, which can already scarcely be called a crypto because your funds are literally not safe, cryptographically speaking. This is a centralized and likely completely illegal mess. Your funds are literally safer with banks, who have legal frameworks to abide by.”/u/Edgegasm

That post by Edgegasm is currently the most-upvoted post in the r/cryptocurrency thread with over 600 upvotes.

Ultimately, EOS has been struggling in the early weeks of launch. Is the network too centralized? Do block producers have too much power? Is a $10,000 per day incentive not enough for some people? These are all questions that EOS needs to answer if it’s going to succeed or fail in creating the world’s biggest decentralized bank.

[FREE] Get Our Best Crypto Trading, Mining & Investing Hacks:

cryptocurrency-event-2018

*Action Required* Enter Your Email To Get Insight For Trending Coin News & Reviews

I will never give away, trade or sell your email address. You can unsubscribe at any time.

1 COMMENT

  1. “This whole story comes from a screenshot posted to Twitter and then later to Reddit. The conversation is purportedly between the block producer, EosStore, and a member of the crypto community, Daz.”

    The whole story came from my original news article at: https://steemit.com/eos/@cigarbutts/the-dog-ate-my-homework

    The twitter post is from someone who copied and paste my telegram private discussion with eos.store. If you’d like me to verify the story for you, through video evidence that I also took, I’ll be happy to do so. I’m known as Daz on Telegram, cigarbutts on Steemit, and ValuInvstrToday on Twitter.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

twelve + one =