Today, EOS has been renamed to Vaulta.

The ancient public blockchain that raised a whopping amount of funds seven years ago, was once hailed as an early "Ethereum Killer," has finally abandoned its dream of achieving a million TPS, and announced a shift towards Web3 banking. The grandiosity of its $4.2 billion fundraising, the buzz of 21 super node elections, and the utopian declaration of a million TPS—these fragmented pieces together form the most costly idealistic experiment in blockchain history.

Seven years later, apart from the old hodlers, no one remembers this now 97th-ranked "ancient public blockchain." In the days to come, EOS will no longer be a high-performance public blockchain but will instead undergo a transformation to venture into Web3 banking—it has relinquished its once-held dreams, and even forsaken its name.

We will use this article to commemorate the craziest product of the ICO era, a story that burned so much money, leaving behind a nostalgic tale.

A Tower of Babel Built with Code and Dollars

In 2017, the blockchain industry was experiencing its craziest bull run. Bitcoin broke $1,000 in early year and skyrocketed to $20,000 by year-end, Ethereum's smart contracts revolutionized the crypto world, ICOs became the most popular fundraising method, hundreds of projects flooded the market, all striving to build a "decentralized future."

Amidst this capital frenzy, EOS emerged with the banner of "Blockchain 3.0," aiming to surpass Ethereum. Its whitepaper painted an ideal nation: a million TPS, effectively solving Bitcoin and Ethereum's scalability issues; zero transaction fees, allowing regular users to transact without paying high gas fees, making on-chain transactions as seamless as cloud applications; ultra-fast block times, with 21 super nodes responsible for transaction packaging, no longer hindered by miner competition; a blockchain supercomputer enabling decentralized applications (DApps) to truly become a reality.

Founder BM (Dan Larimer) was EOS's biggest asset. For the tech-savvy, he was a genius—suggesting a change in the consensus mechanism to Satoshi Nakamoto just a year after Bitcoin's birth, arguing that PoW (Proof of Work) was not efficient. Later, he founded BitShares and Steemit, becoming one of the most renowned engineers in the crypto space. But BM was not just a technical geek; he also harbored utopian ideals, believing that blockchain could change everything, and that EOS would be the ultimate solution to human societal structures.

Backed by a genius CTO and a top-tier marketing team, the ambition of this story was already on full display. On June 26, 2017, EOS launched its crowdsale, planned to last for a year (in comparison, most ICOs had fundraising periods ranging from a few weeks to a few months).

Global investors flocked in, raising 1.85 billion USD within 24 hours. In the end, EOS successfully raised 4.2 billion USD, becoming the largest fundraising event in the history of the crypto world, far surpassing all projects at the time, including Ethereum's 18.5 million USD.

Top 10 ICO Projects of 2018

With 4.2 billion USD, EOS leaped to become a super capital entity in the crypto world.

In April 2018, EOS's price surged from 5 USD to 23 USD, marking a monthly growth of 360%, placing it in the global top five, only behind Bitcoin, Ethereum, Ripple, and Bitcoin Cash. Media hype went wild, with headlines like "EOS to Become the First Trillion-Dollar Market Cap Cryptocurrency" and "BM Is the Next Satoshi Nakamoto" flooding the scene. Ethereum developers also started to feel anxious, fearing that EOS's rise would lead to Ethereum's decline.

Before EOS even launched its mainnet that year, it had already become the hottest star in the crypto world. Driven by FOMO (Fear Of Missing Out), EOS was seen as the "next-generation Ethereum," with some even predicting it would reach 1,000 USD.

The super node election became a global sensation, with figures like Li Xiaolai, Lao Mao, and other "godfather-level" individuals making high-profile appearances, and exchanges, mining pools, Wenzhou Capital, and even traditional funds rushing in—this election was dubbed the "Wall Street IPO of the Blockchain." A "Crypto National War" unfolded among nodes in China, the U.S., and South Korea, with the Korean community chanting "Not investing means not Korean," Li Xiaolai's Coin Capital holding four node votes, and the Wenzhou group entering the scene with eight-figure EOS acquisitions.

With a 4.2 billion USD fundraising, a stellar project, an underdog public chain, drawing attention from all corners, and BM going to Hong Kong picked up by the project team in a luxury car at the airport—the scenario seemed perfect. However, beneath the feast, everything was built on a Tower of Babel constructed of code and dollars.

EOS's Peak Was Only the Beginning

Amidst the frenzy, issues had silently surfaced:

EOS's voting system was criticized for being easily controlled by whales, and the decentralization of super nodes was questioned; post-mainnet launch, several technical problems emerged, leading developers to question EOS's stability; deep involvement of exchanges and capital giants made super node elections no longer fair, and dissenting voices began to arise in the community; after the mainnet launch, BM began frequently altering the governance mechanisms, causing community confusion.

However, at that time, the market was still immersed in euphoria, and all doubts were overshadowed by the slogan "EOS is about to change the world." During that golden age, everyone believed that EOS would become the future overlord, even the ultimate form of the blockchain industry. However, reality is often harsher than dreams, and no one anticipated that this once highly anticipated project would fall from grace in just a few years.

Tech Disillusionment: From "Million TPS" to "Distributed Database"

At that time, the biggest issue in blockchain was scalability, how to process more transactions per second. The Bitcoin network could handle 5 to 6 transactions per second, and Ethereum was somewhat better at around 20 transactions per second. However, these were far from meeting the demands of blockchain.

In such a scenario, EOS's million TPS made everyone go crazy. You see, during the midnight of Alibaba's Double 11, the highest transaction volume per second was in the tens of thousands.

However, after the EOS mainnet had been live for 4 months, the highest TPS was only 3996, far from the million that was initially touted.

EOS fell far short of expectations, but on the other hand, Ethereum gradually improved its performance through Layer 2 scaling solutions, while competitors like BNB Chain, Solana, and others quickly rose, completely erasing EOS's "performance advantage."

People found that the so-called "million TPS" was actually a carefully crafted word magic — BM quietly added a premise to this number: it must rely on an infinitely scalable sidechain ecosystem. In his vision, if one chain could process 4000 transactions, 100 parallel sidechains could achieve 400,000 TPS. However, by 2023, the EOS ecosystem had only launched 3 sidechains, of which two had become "ghost chains" due to developer exodus. BM's response to this was to turn around and announce on Twitter that he was "researching anti-inflation algorithms," while at this point, EOS had dropped out of the top 20 in market capitalization.

Usability is EOS's most fundamental problem.

Initially, EOS hit a sore spot with users by offering free transactions. Users quickly discovered that although EOS transactions did not require fees, they had to stake tokens to exchange for CPU resources. When the network was congested, transferring 10 EOS required staking 5 EOS worth of CPU — essentially a disguised freeze of user funds. During a peak DApp traffic event in 2020, 2000 EOS could only exchange for 1.3 seconds of CPU time, and regular users had to repeat the process more than ten times to complete a transaction.

Furthermore, BM also set a RAM supply limit, which led to market speculation on RAM, causing RAM prices to skyrocket by 100 times. Developers had to spend a high cost to purchase storage resources. In 2018, some speculators began hoarding RAM, and in just a few months, RAM prices surged from 0.01 EOS/KB to 0.9 EOS/KB, severely impacting DApp development, causing many new projects to directly abandon EOS.

Ultimately, this resource management model made EOS's user experience even worse than Ethereum's: on Ethereum, users can directly pay Gas fees to complete transactions; but on EOS, users must first learn a complex resource staking mechanism and even have to spend a lot of money to buy CPU and RAM, severely hindering the development of the DApp ecosystem.

Looking at it from today's perspective, it is actually difficult for us to understand why, despite such a poor user experience, EOS had a boom period at the end of 2018 and the beginning of 2019: DApps mainly consisting of on-chain gambling were very popular on EOS.

On December 24, 2018, data showed that in the past week, a comprehensive comparison of the DApp ecosystems of the three major public chains ETH, EOS, and TRON revealed: Total number of users: EOS (75,346) > TRON (45,777) > ETH (33,495); Total number of transactions: EOS (23,878,369) > TRON (13,803,322) > ETH (413,019); Total transaction volume (USD): EOS ($345,489,773) > TRON ($135,201,171) > ETH ($44,272,856);

It is evident that at that time, EOS was indeed highly anticipated by the community, and its ecosystem's prosperity surpassed that of ETH and TRON. Perhaps it was this "Dream of the Red Chamber" that makes the old-timers in the cryptocurrency industry nostalgic about EOS.

Governance Collapse: Vote Buying, Centralization, and Community Division

Of course, when we talk about governance now, it seems we can only chuckle, but at the time, governance in EOS was highly anticipated. BM strongly believed that under his careful design, the 21 nodes would make this network far superior to Ethereum.

He believed that this network would consist of 2/3 good actors, where everyone's actions would be benevolent, and malicious nodes would be voted out by users. It was a perfect utopia. The reality proved he was too naive.

After the EOS mainnet went live for 3 months, mutual vote-buying among nodes has become an unwritten rule. To receive EOS block rewards, no one can stop whales and nodes from voting for each other. What's even more outrageous is that the nodes engage in misconduct themselves.

EOS functions with a mechanism where 21 super nodes take turns producing blocks. At one point, a user's funds were stolen by a hacker, and the solution was for the 21 nodes to blacklist the hacker's address to prevent further transfers. This was a normal and straightforward operation, but one of the nodes at that time did not comply. As a result, the hacker was able to transfer the funds during the time that node produced blocks, as if nothing had happened.

Brendan Blumer (BM) once attempted to curb such behaviors through an EOS Constitution but quickly found that the Constitution was toothless. Since the super nodes themselves benefited from the vote-buying, they had no incentive to enforce the rules outlined in the Constitution. The arbitration mechanism was entirely ineffective and lacked any practical enforcement.

In 2019, BM completely abandoned constitutional governance and declared that the EOS community should evolve freely without intervention in the super node election process. By 2020, EOS's super nodes had devolved into a battleground for exchanges, mining pools, and capital consortiums, rendering the votes of ordinary token holders meaningless. Delegated Proof of Stake (DPoS) was supposed to be a model of decentralized governance but ended up becoming a cryptocurrency version of oligarchic politics.

Another major governance issue EOS faced was that before the EOS mainnet went live, BM proposed an innovative "EOS Constitution" aimed at using code and rules to govern behavior on the network. However, within a few short months, the Constitution underwent several revisions, leading to growing community dissatisfaction. In June 2018, the original EOS Constitution allowed super nodes to arbitrate transactions, but due to power abuse, BM decided a few weeks later to amend the Constitution to prohibit node intervention in transactions. In 2019, BM suddenly proposed scrapping the Constitution in favor of "user contract governance," throwing the community into confusion about how EOS's governance rules would evolve. This ever-changing governance model caused developers and investors to completely lose trust in EOS.

During this crisis, BM and Block.one (EOS's parent company) gradually shifted their focus from the EOS main chain to the EOSIO software. BM believed that "the future of blockchain lies in enterprise-level applications," so he started promoting EOSIO to enable enterprises to build their own private chains rather than focusing on optimizing the EOS public chain. Core updates to the EOS main chain almost came to a standstill, with many key upgrades such as cross-chain functionality and storage expansion remaining stagnant.

As a result, EOS's developer ecosystem experienced a rapid decline: while the Ethereum community thrived with high activity levels and the emergence of applications like DeFi and NFTs, the number of DApp developers on EOS steadily decreased. By 2022, EOS was losing nearly 100 developers per month, and some EOS browser and wallet projects even shut down entirely.

External Strangulation: Mining Crisis, Bear Market, and Block.one's Silence

At the end of 2019, the price of EOS dropped below $5, reaching a low of $1.8 the following year, plunging over 90% from its all-time high of $23. As super nodes faced a survival crisis, developers fled, and market liquidity dried up, the EOS ecosystem most needed a rescue from its parent company, Block.one.

It is well known that early on, Block.one raised $4.2 billion, making it the largest funding event in crypto history. In theory, this funding could support the long-term development of EOS, support developers, drive technological innovation, and enable the ecosystem to continue growing. When EOS ecosystem developers begged for assistance, Block.one handed out a $50,000 check—barely enough to pay a Silicon Valley programmer's salary for two months.

"Where did the $4.2 billion go?" the community asked.

In an email from BM to Block.one shareholders on March 19, 2019, part of the answer was revealed: as of February 2019, Block.one's assets (including cash and invested funds) totaled $3 billion.

Of this $3 billion, around $2.2 billion was invested in US government bonds, referred to in the email as "liquid fiat assets."

Some information about the invested funds can be found in public records: gaming company Forte, NFT platform Immutable, and a vacation hotel in Puerto Rico, among others. In general, the companies invested in all share a common characteristic: they have little relevance to EOS.

Before Bullish became a core business, Block.one still held one ace in the hole: the social product Voice, deployed based on EOSIO smart contracts, was the only product with a business relationship to EOS. To build Voice, Block.one invested $150 million, with the largest expense being $30 million to purchase a domain name, with the seller being MicroStrategy, the publicly traded company that owns the most bitcoin, as mentioned earlier.

However, as if cursed by fate, Voice's first product launch lasted half an hour, falling short of expectations, leading to disappointment and a subsequent drop in EOS's price. Six months later, when the Voice iOS version was launched on the Apple Store, various malfunctions and Bdangsug occurred on the first day. The Voice website displayed an "Error 1020" and claimed to be "using a security service to protect themselves from online attacks." EOS holders were thoroughly disappointed, and Voice finally announced in September 2023 that it would gradually close down.

Project Launched by Block.one

The thunder is loud but the rain is small, which seems to be Block.one's consistent style of investment in projects. Since then, Block.one has not made any major investment moves and has opted for complete inaction. Today, Block.one holds 164,000 Bitcoins, meaning its wealth has grown from $3 billion in 2019 to the current $16 billion, a fivefold increase, making it a liquidity management master.

There is no actual DeFi, NFT, or DApp ecosystem support plan. In contrast, the Ethereum Foundation and Solana Foundation continue to subsidize developers to drive technological innovation, while Block.one has done almost nothing.

An early investor in EOS angrily questioned on Reddit: "We invested in EOS because it promised to disrupt blockchain, not to let Block.one use this money to speculate on Bitcoin!"

Although Block.one currently holds the second-largest amount of Bitcoin after MicroStrategy, with a total of 160,000 BTC worth $16 billion, EOS, which has not received any support from these raised funds, continues to decline.

Block.one's governance chaos is even more staggering. Block.one is increasingly resembling a "family business" centered around CEO BB, with BM not part of this family.

Sister as CMO: CEO Brendan Blumer's sister, Abby, was parachuted in as Chief Marketing Officer, and her only visible "achievement" was to change the EOS brand color from tech blue to a "softer Morandi Gray."

Mother as Venture Capitalist: Blumer's mother, Nancy, runs the EOSVC venture capital fund. The social app Voice, led by her, has been online for a year with less than 10,000 users but has consumed $150 million.

BM's Puppet Show: Founder BM confessed on Twitter that he has "no decision-making power" and can only watch as the team pours resources into the enterprise-grade toolkit EOSIO—a project customized for giants like Walmart, completely unrelated to the EOS mainnet.

In 2021, the community initiated a "Forking Rebellion" in an attempt to sever Block.one's control. The EOS Foundation, as a representative of the community, stepped forward to negotiate with Block.one. However, after a month of discussions where various solutions were explored but not agreed upon, the EOS Foundation, along with 17 nodes, revoked Block.one's power and ousted it from the EOS governance. Without its parent company, EOS started to resemble more and more like a DAO.

Following the split between EOS and Block.one, the EOS community engaged in a years-long legal battle regarding the ownership of the funds raised initially. However, to this day, Block.one still retains ownership and control of the funds.

Even more ludicrously, since 2024, BM's Twitter content has rarely touched on blockchain, with the only technical discussion being sporadic mentions of database optimization. Instead, his focus has shifted entirely to theological preaching, with content heavily centered around Bible interpretation, world-end prophecies of geopolitical conflicts, and criticisms of mainstream Christianity...

BM's Twitter Content

Looking back at this seven-year-long crypto epic, the collapse of EOS has long served as a cautionary tale: no matter how high the TPS, how sophisticated the resource model, or how complex the user experience to the point of deterring the average person, everything is meaningless. The once self-proclaimed "Ethereum Killer" eventually met its demise in the quagmire of its economic model, governance chaos, and technological stagnation.

Seven years ago, EOS raised a staggering $4.2 billion, touted as the most brilliant fundraising miracle in blockchain history; seven years later, its story has become the biggest "joke" in the crypto world.

In the end, EOS did not kill Ethereum; it killed itself first.

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