{"id":63998,"date":"2018-06-28T20:40:52","date_gmt":"2018-06-29T03:40:52","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=63998"},"modified":"2026-06-12T10:42:26","modified_gmt":"2026-06-12T09:42:26","slug":"eos-governance-divides-crypto-community","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/eos-governance-divides-crypto-community\/","title":{"rendered":"EOS Governance Divides Crypto Community"},"content":{"rendered":"

The hotly-contested nature of EOS<\/a> decentralization and governance remains at the forefront of blockchain community discussion. The recent inaction of an EOS block producer \u2014 resulting in the loss of 3,570 EOS, or about $27,500 \u2014 brought the EOS governance model under harsh scrutiny over the past week, as industry experts and observers debate whether EOS can be defined as a \u201cdecentralized\u201d cryptocurrency.<\/p>\n

The EOS project, which can be likened to a hybridized blockchain system where property rights are enforced via community sentiment, relies on 21 block producers that operate the network. These block producers are voted in by the EOS community and rewarded with EOS tokens.<\/p>\n

Block producers contribute to a three-party system that composes the EOS governance architecture. EOS token holders are the second element of the EOS ecosystem, while the EOS Core Arbitration Forum (ECAF) function as arbitrators<\/a> \u2013 whose role within the EOS ecosystem created a significant amount of controversy since the EOS mainnet launch.<\/p>\n

EOS Core Arbitration Forum Creates Blacklist,\u00a0Ignored by Block Producers<\/h2>\n

The ECAF as an arbitration body within the EOS ecosystem is able to make decisions regarding EOS accounts deemed to be in violation of the EOS constitution. Recently, the EOS governance structure blacklisted a number of EOS accounts that were identified as associated with fraudulent activity.<\/p>\n

\"\"<\/p>\n

Blacklists are issued by ECAF and are delivered to block producer meetings. The reliance of the entire EOS ecosystem on these meetings is an apparent weak point in the $4 billion project, as a recent meeting that was missed by a critical block producer saw 3570 EOS lost in a governance failure.<\/p>\n

Block producer EosStore was not compliant with an ECAF blacklist issuance, and as a result, an account lost funds. An official statement<\/a> released by EosStore on June 26, 2018, confirmed the block producer did indeed neglect to update blacklist data:<\/p>\n

\u201cECAF has provided two blacklists, however, the second blacklist was not discussed in the community Zoom meeting no formal announcement of it could be found.\u201d<\/p><\/blockquote>\n

While EosStore did note that affected accounts will \u201cabsolutely\u201d be compensated, a significant flaw within the EOS governance structure was highlighted \u2014 ECAF currently has no official channel to publish its announcements:<\/p>\n

\u201cEosStore now sends an invitation to all BPs to co-develop a software providing publishing platform for ECAF arbitration orders. Hope BPs join us to make sure the voice of ECAF be executed duly and consistently.\u201d<\/p><\/blockquote>\n

Blockchain Community BAHJSDA<\/h2>\n

The execution of ECAF blacklist orders has created dissent within the cryptocurrency community, with several industry experts expressing the perspective that the EOS governance model is at odds with the libertarian ideal of distributed ledger technology.<\/p>\n

\n

We have stuff like this. It's called the legacy financial system. Don't confuse it with a cryptocurrency. pic.twitter.com\/5ANQSvgsrq<\/a><\/p>\n

— Charles Hoskinson (@IOHK_Charles) June 24, 2018<\/a><\/p><\/blockquote>\n