When I spoke with Brendan Blumer at Token2049, EOS was just coming off some backlash from the John Oliver show (which they responded too). But the CEO of EOS and Block.One seemed calm and composed and was bullish about the future of the blockchain project, whose token is the 6th largest cryptocurrency in the world going by market cap.
I had a good 20 minutes with Brendan and we discussed the current state and the future of EOS and the state of the crypto and blockchain market today –
What would you say the problem with platforms like Ethereum, Blockchain 2.0 and other similar projects that EOS is specifically solving right now?
So when you deal with poof-of-work, you generally have flawed economic models and it highly limits the use-case. If you take a look at Bitcoin and Ethereum, over the last several years, we’re now spending about $5-$10 billion USD a year, to process transactions on a network that can do three to four transaction per second. So what you’re really looking at is about $100 dollars per transaction, before transaction fees. We pay twice for it; we pay for network inflation and we also pay for transaction fees.
And so when it comes to putting a timestamp on something or putting up content or even a like on Facebook on the blockchain, you can’t pay $100 per transaction. Its greatly limited and the economic model is built in such a way that as the network gets bigger, we pay more for the exact same thing. EOS has built, using proof-of-stake, but ultimately preserves proven computing principles which are large high proofed cluster computing systems that can process huge amounts of single-threaded bandwidth, but also block producers can schedule things asynchronously which effectively creates parallel processing for the blockchain.
So when you achieve that, you achieve real horizontal scalability, you achieve optimum single threaded performance and now you can start to say that if we can use a single distributed system and they can build the next Facebook. And that’s what it solves. Right now there is a huge gap between what we know is possible with blockchain and what the existing infrastructure can deliver. Essentially, EOS closes that. And all these crazy ideas that blockchain can do, these communities that will disrupt Facebook become possible when you have an underlying protocol that’s performance is as efficient as EOS.
Your product is completely dependant on the number of takers and the community that surrounds it, where is the product at right now, has it reached a stage of completion? And what is the adoption in the community looking like?
The technology is open source and everyone can see as we build it. We’ve been building it for a long period of time. The actual blockchain itself is already running and it’s a concept that is sort of out-there, we’ve just kind of evolved it by adding a scripting language and sort of making it easier for developers to manipulate the protocol for their own purposes.
Everything is near live, in terms of completion, in the sense that developers building on it do not need to worry about backwards compatibility. There will be no more changes that will break what they are working on, there are already a hundred projects that are already building in the test environment. We have a test-net. And the only thing that happens on the 1st of June, is that we publish the license that makes it legal for people to start using the code for commercial reasons. That is the only thing missing and right now it is going under huge amounts of testing to make sure there are no gaps or anything like that. The product itself is pretty much done.
Are there any beta companies you’re working with who are going to use EOS?
We have thousands of companies, projects, entrepreneurs or just developers who reach out for funding or to learn more about EOS. But yes, there is everything from small teams to public companies that are already building on EOS right now.
They are already working on it, but you won’t see anything launch until the 1st of June. Also, most of the projects that are building haven’t announced themselves yet, because we’re not really in a position to do that yet. But we will be hearing a lot more as the launch date approaches.
How is the ecosystem looking, right now? As a company and person who is under constant media scrutiny, how do you manage and handle perception in such a niche community where everything that is said about you is directly reflected in your company’s economics?
One thing about the media is that they always write about and feel what they want to feel about you. So people’s minds are made up before they go into an interview, that is why you have to be very careful.
And generally when I’m speaking to a reporter, they’ve already written a story and they’re just looking for anything that they can add to empower it or to lend credibility to a story they’ve already decided before speaking with us.
The amount of money involved in EOS is a matter of focus for the media because that is something that the community or the public like to read about. So our approach is to actually stay very low-key in the media until after the sale is over so that we can focus more on the technology. Before we started the token sale, people wanted to talk about the technology and I feel like after the token sale ends, they’ll want to talk about it again. So what we’re focusing on is talking about the technology and during the token sale people want to hear more about the sale, so we stay out of the media as much as we can and kind of focus on building the product.
It is one of those things where media does have an effect, but really don’t because at the end of the day the people who are going to decide whether EOS succeeds or fails are the developers. So media is important in terms of public perception, but ultimately what will decide the winning protocol is the developers and flat-out what they can accomplish on the platform. The good developers don’t care about brands, they care about performance and at the end of the day they usually end up at the right one.
How important is it for a blockchain company’s CEO to be a technologist?
You need very senior technology talent at the top of management. So it doesn’t need to be the CEO, it could be the CTO or whatever. But they need to be at the top and you need to have that box checked. When you find a CEO who is not a technologist and they don’t have a good technologist with them, or they’re looking for a development team, that is a huge red flag. Because that means they are not innovating with technological innovation.
But you also need a good combination of skill-sets because if you get just good technologists you can also have some holes. So the key is having a well-rounded management team but having very capable tech talent at the top of that organisation is critical.
There is a popular opinion that in these companies the technologists are looking at the long-term problems that they need to solve while the businessman is more worried about what is going to happen in the next six months and that there is a tussle between the two. Is that a problem EOS faced? How did you strike a balance between the two?
The next six months will always decide next six months. So you can’t be building something for ten years and ignore the six months. You have to strike common ground because otherwise, the world will weave itself into something unrecognisable before you even launch the product.
Bitcoin is in a really tough position and at some point, I think it’s going to be really tough because of the vested interests and its performance limitations to continue to scale without moving things off the blockchain. And once you move off the blockchain you need to figure out whether you’re dealing with the blockchain or PayPal 2.0.
As someone who’s starting out building a blockchain product today, what are some considerations that you, as the CEO of EOS, would say that this person should have?
In addition to having the technological and business people you need, the most important thing that will decide whether your company becomes viable or not. It is easy to say Airbnb and Facebook could all be disrupted.
Be focused on the token economies and fundamentals. Most alt tokens will go to zero, the crypto industry will grow, but the big tokens of tomorrow are not the same tokens of today, because most of them are improperly designed and they lack economic fundamentals. And it’s more like selling a magic potion that selling something that makes any type of financial sense.
The future of the token market is the next social network where the token itself is how you get advertisement. So the ad revenue, the proven multi-billion dollar revenue streams of ads are going back to the token holders who are getting tokens for generating the content. And now you have users and advertisers, you’ve closed the loop and removed the shareholders. When you have a token that is worth 500 million dollars, that model has successfully disrupted Facebook and the existing tokens will be worth nothing.
And you see this coming from players like Facebook or someone new?
It will come from new players because players like Facebook can’t remove their shareholders. And very rarely are large companies able to change radically enough in order to do so and so it will come from new players. The only reason it hasn’t happened yet is that the underlying protocol isn’t performant enough. You can’t build that on bitcoin and I think it is coming with EOS. we’re already building really big initiatives on our own technology.
We’ll wait for 1st of June.
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