As an eighth-largest coin by market cap in the entire world, EOS was meant to be a public blockchain that allowed developers to create their decentralized applications. It’s been a beneficial and attractive place for many blockchain startups to launch their dApps, and the network activity has seemed to grow, even as the price has fallen.
Launched in the summer of 2018, it has been now suffering from the downward trend of the market over the last week. It seems that dApps or decentralized applications hosted on the EOS blockchain platform have not been doing all too well on the security front lately. Recent data suggests they have lost nearly 1 million USD because of system hacks over the past five months.
Down by over 50%, EOS’s drop coincides with the phantom accounts and hacking issues that keep showing up on the blockchain. This reflects the name given to it by some investors in the industry – the Ethereum Killer.
The EOS blockchain is extremely popular in the Chinese market and it is no wonder that this news was first broken by Chinese news agency Blockchain Truth.
The data was collected by blockchain security company PeckShield which tracks usage and statistics across various networks. The report published by the firm tracks data from almost half a year, from July 2018 to November 2018. During the period in focus, the EOS blockchain faced a total of 27 breaches. These breaches cost the blockchain network as many as 400,000 EOS, creating a combined value of nearly a million dollars according to current market prices.
Known as Ethereum killer, this blockchain was doing rather well in trumping the major features of the Ethereum blockchain. However, it now seems that just like Ethereum had run into security issues with regard to DAOs (decentralized autonomous organizations) earlier, EOS is having trouble ensuring its dApp platform is bolstered against threats from rowdy raiders who siphon off amounts worth a million or more.
Attacks Could Get More Frequent
Guo Yonggang, an expert cited by Blockchain Truth, believes that most of the attacks on EOS DApps correlate with their vulnerabilities rather than with a bug in EOS itself. Yonggang also tends to think that similar attacks will become more frequent, as hackers are intensively seeking exposures in applications.
“DApps on EOS started to explode since the end of September, and the number grew rapidly in October. But with EOS DApp getting hotter, the group-controlled accounts started to emerge since October 4th.”
And while the gambling hype I coming down, the rest of the dApps are still managing to have about 7.05 million in trading volume on August 25th, beating down Ethereum by about three times over.
Just for the reminder, the EOS mainnet was launched in June but took a while before the system went live. As its still in the beginning stages, the system has numerous loopholes and there are many improvements lined up. A dApp called Werewolf game suffered an overflow attack in July and EOSBet faced a RAM devour problem in August. Both these incidents were caused by security issues.
The report stated that as time went on, more attacks were due to the negligence of dApp developers. The report also claimed that most incidents after November can be attributed to “development logic problems”. These can be considered as early loopholes for the ecosystem.
“DApp is still a brand new attempt, especially the contract is developed in C++ language. It is more difficult to get started, and it is more prone to various logic processing problems,” read the report. “The better way is for developers to build their own early warning platform. The benefit is that it can be implemented. Monitoring, as soon as the alarm sounds, immediately turn the game off.”
We already wrote how the Starteos, a block producer for the EOS blockchain, has openly offered to share part of its income with users. This is significant because it suggests that the EOS network, which is one of the most valuable blockchains in the world, is not, in fact, ddecentralizedor democratic at all, contrary to its own claims.
It is also important because of the size of the company. This Ethereum-esque blockchain network, raised $4 billion during its initial coin offering, and its token, EOS, has a current market value of $2.5 billion.