EOS like LSK will most likely be controlled by a voting mafia. I.e no/low value add through inflation and easy attack vectors. (As explained pretty well by Vitalik -
https://vitalik.ca/general/2018/03/28/plutocracy.html)
It’s also likely to be the least private blockchain by design, which is probably why Dan advocates radical transparency, like it’s a positive.
I’m bullish about EOS short term though as there should be a lot of projects that will be benefit from the high performance & EOS has a lot of money to throw at it. It will also be positive for crypto short term as performance was a significant bottleneck. The critical EOS design flaws in every area excl. performance should only make it unpopular in circa 1-2 years when Ether/other blockchains have scaled in terms of performance and introduced privacy solutions that can be updated over time.
But >10x between now and end of year once current high inflation due to ICO ends, is very doable.
Mining rewards in Ethereum are roughly 8m usd per day at 400 USD/ETH; that’s over 2.5 billion a year to process <15 tx per sec, paid for through 7% annual network inflation.
EOSIO Block producer rewards are planned to be roughly 1% annual inflation, a small fraction of the cost of Ethereum.
All blockchains are voting machines, it’s just a matter of who votes; DPOS decentralizes control of mining, is more resistant to cartels and DDOS attacks, and delivers low cost high performance.
In EOS, power amongst miners is evenly distributed. Moreover, miners can be replaced by token holders if they are not operating in their best interest; this prevents scenarios like Ethereum. DPOS is alignment.
Relevant past article:
https://medium.com/eosio/who-should-control-a-blockchain-d841c18109c3POW is wasteful yes. ETH is switching to POS at some point.
DPOS would almost always ends in cartels. In POS with 1% of the supply you get 1% of rewards, in DPOS even owning 1% or 10 Million EOS you could get none of the rewards. As demonstrated in practice by LSK.
The switch from 5% to 1% rewards is an acknowledgement that DPOS is a poor consensus model imo.
If DPOS was good a voting system, then honest voters would direct the 5% inflation to high performance nodes, awesome development & marketing, while returning the unneeded amount equally to shareholders/burning it, ergo the % inflation wouldn’t matter. But the EOS developers know most of the funds will just end up in the hands of the most powerful voting cartel who will pay themselves millions per year for nothing, hence reduce it to 1% to minimize damage.
With few nodes and votes in the hands of cartels + Low privacy (Dan actually advocates even less, he wants ‘radical transparency’ - phone number, photo, birth date etc - which would make EOS non-fungible.) People will realize EOS provides very few of the advantages of decentralization so they’re better off using a centralized private blockchain run by IBM/other if the main thing they want is a distributed ledger & high performance.
As I said I think >10X gains is doable for EOS this year but it doesn’t have a long life expectancy at the top because many others are competing on vastly increasing performance but also vastly increasing decentralization, privacy & adaptability, all of which need to be combined to create the market leading smart contract blockchain a year+ from now.