Original source: Wired Magazine
Original Compilation: EOS Ecosystem 4 Billion DAO
In 2017, Block.One started the development of the EOS blockchain and raised a record $4 billion in IXO. Five years have passed in the blink of an eye, and now EOS has finally been taken over by members of the EOS Foundation (ENF for short), realizing the landing on the road to decentralization.
On a Wednesday morning in November 2021, Yves La Rose, a member of the EOS blockchain community and one of the current ENF leaders,Virtual Meetups for Chinese UsersIt said: "For now, EOS is a failure".
Block.one (a Cayman Islands based company) used open source technology to create the original EOS. The white paper shows that EOS at the time promised to achieve a blockchain technology innovation that is more efficient than any other encrypted network.
Before EOS went live in June 2018, Block.one raised over $4 billion in the largest token offering ever. (IXOs are a way for startups to raise huge sums of money in exchange for cryptographic tokens that haven’t yet built a blockchain platform.) Yves La Rose was working on EOS at the time, at one point managing EOS Nation’s “block producer.” ” -- a digital referee responsible for verifying transactions that occur on the blockchain.
In the four years since June 2018, the development of EOS has taken a sharp turn for the worse. Its user base is shrinking, it supports only a handful of popular apps, its lead developers are leaving, and the value of its token (also known as EOS) has plummeted from $10 in June 2018 to $10 in late 2021. $4.40. At last fall's virtual conference, La Rose, who chose to stand up as a stalwart of EOS supporters, made it clear that he and others in the community were victims of Block.one, an enterprise that grew from their Profit at work and leave them with nothing.
“Block.one deliberately downplayed their ability to influence the development of EOS,” the 39-year-old Canadian entrepreneur said at the conference. “This amounts to negligence and fraud.”
To this day La Rose still believes in the potential of EOS. His dissatisfaction is directed at Block.one, which he and most supporters believe Block.one has screwed up the EOS project. In line with his dedication to EOS, under the unremitting efforts of La Rose, he proposed a plan to save EOS: an organization called the EOS Network Foundation (ENF) was established to revitalize the decentralized ecology of the blockchain , and let Block.one pay for the decline of the EOS project.
He hopes that Block.one will leave EOS and let Block.one return part of the funds raised in the name of EOS.
Block.one had no intention of meeting his demands. In May 2021, Block.one announced that it will establish the Bullish cryptocurrency exchange, the majority of the exchange's liquidity funds will come from IXO proceeds from EOS. Block.one inCayman Islands registered Bullish, set up subsidiaries in the Cayman Islands and cryptocurrency-friendly jurisdictions, including Delaware, Hong Kong, Singapore and the British Overseas Territory of Gibraltar, and plans to merge Bullish with a company called Far by March 8, 2022. Peak Acquisition Corp's special purpose acquisition company (SPAC) merger toListed with a registered capital of US$9 billion. After two extensions,Current Listing Deadlinefor July 8, 2022.
legal documentlegal documentIt is said that Block.one can use IXO to raise funds as it pleases, but it is well known that Block.one has not fulfilled its original promise.December 2017, Block.one CEO Brendan Blumer publicly pledged to use $1 billion from the IXO fundraising through an investment arm called EOS VC to develop blockchain technology that supports EOS and start-ups that build applications for it . But in the end, Block.one did not realize the promise. La Rose said that the company invested most of the funds in an unknown way, completely forgetting the promises made by the EOS community. Therefore, when La Rose established ENF, it stated that it would hold Block.one accountable to the end on behalf of the community.
Tama Churchous, who held a senior position at Block.one from the establishment of Block.one to February 2021, broke the news: "They have been privately planning to open a new exchange, and this work plan has started since early 2019."
ENF also found signs of Block.one's interest in EOS in terms of technical updates. Since the beginning of 2021, the code quality output of EOS has been declining. This situation was exacerbated by the departure of CTO Daniel Larimer and other senior developers in January 2021. Larimer accepts shortly after leavingCryptonomist interview“Block.one is no longer about building and promoting technology that sets people free,” complained at the time. (Though this time Larimer declined Wired’s request for an interview.)
Taken together, this all suggests that Block.one lacks the credibility to deliver on its promises.
In November 2021, shortly after La Rose's speech, he issued an ultimatum to Block.one in the name of ENF: reinvest in the EOS blockchain and grant the intellectual property rights of the EOS blockchain technology to ENF. Otherwise, the block producers will stop the token "release" process that was originally planned to gift Block.one 100 million EOS in 10 years. ENF, which is supported by major nodes in the community, has made a fine-tuning of the blockchain code. At present, Block.one can no longer obtain gift tokens.
In an email to WIRED, Block.one spokesperson Abby Kuhanez pointed to public disclosures related to Bullish, the terms of the ERC-20 token sale, and the "broad support" community for using its technology. documents, along with a 2019 audit report on the token sale jointly performed by law firm Clifford Chance and professional services firm PWC. Kuhanez said that “many of the assertions” in this story appear to be questions raised from claims in the Block.One lawsuit,” but did not respond to our request for elaboration.
“Block.one is largely responsible for the downfall of EOS, Block.one basically ruined everything for everyone in the EOS community. They are bad guys,” La Rose said.
Former Block.one insiders also describe the hidden side of Block.one: a completely failed company paralyzed by legal issues and unable to complete any projects, except for the billions of dollars in crypto profits due to market upswings. .
Block.one was established in 2016 by Brendan Blumer's Hong Kong real estate company ii5, an expert in cryptocurrency technology and some big Vs in the field of encryption.Consensus, an industry conference in New York 2017The first publicity was carried out on .
The team then embarked on a global roadshow, selling a token called EOS — an ERC20 token that would soon be convertible to use on the (then hypothetical) EOS chain — in a 341-day online auction. In later years, such auctions attracted the scrutiny of regulators and academia. In August 2021, University of Texas finance professor John Griffin releaseda study, claiming that the EOS ICO showed signs of “wash trading” techniques. He claimed that 21 accounts appeared to act in unison by buying large quantities of EOS tokens and then selling them within an hour, a practice that Griffin believes would inflate token prices for other buyers.
Owners of these accounts hide their actions by passing tokens between multiple wallets between each sale, Griffin said. Block.one said in a blog postnot coordinated, noting that a 2019 audit also found no evidence of collusion. But Griffin pointed out that the audit only looked at accounts owned by Block.one, not accounts related to the company’s executives personally. Regardless, unmasking account owners requires the cooperation of the cryptocurrency exchanges they use. "This is the only way it can be done," Griffin said. The Justice Department did not confirm or deny that an investigation was underway.
A former executive of Block.one said that because Brock Pierce, one of the co-founders of EOS (Brock is also a cryptocurrency investor,andandbudding politician) leading and arranging EOS marketing activities actively, so that Block.one raised funds from IXO that exceeded their expectations. The executive also said that company chairman Kokuei Yuan made it clear from the start that Block.one is a marketing organization that conducts “a token sale: we need to show as little association with it as possible and then exit at a reasonable time.” Another A person familiar with the company's situation also confirmed this statement. (Most of the former Block.one employees spoke on condition of anonymity due to non-disclosure agreements or fear of reprisal.) “The massive fortune of $4 billion is the key reason why people pay attention to EOS. Once we all had good expectations for EOS, we can Do more than just sell tokens, then reduce correlation with EOS, and leave,” said the former executive.
At present, the current EOS plan is a primary public chain created by the Larimer team, and many functions promised before IXO have not been realized. For example, the companygive up9 months after token saleProcess millions of cryptocurrency transactions per secondfunction. The executive also said that even after confirming the characteristics of the technology, Block.one's leadership did not think about how to complete its established development vision.
Block.one executives include chief strategy officer Andrew Lewis, a childhood friend of Blumer's; Blumer's sister, Abby, in charge of communications;first joint ventureOkay.com. "Blumer really likes to be surrounded by people who are very gentle with him, who don't challenge him, who just blow him up," the former executive said. “But the CEO’s job is to make decisions.” The former executive said the company spent months considering where to open its U.S. office before settling on Blacksburg, Virginia, in October 2018 ——a population of just over 40,000,Small towns with unremarkable technical talent except for Larimer。
CommentCommentIt also reflects this experience of Block.one employees.
Another former employee at Block.one's Hong Kong office, where Blumer has been since renounced his U.S. citizenship in 2020, said that while a gifted salesperson, Blumer didn't seem to enjoy the CEO role. "He's rarely in the office, he doesn't sit there and understand what the problems are and how to fix them. He loses interest in that very quickly." This attitude ends up delegating a lot of responsibility to the company's legal team. "A lot of the plans Block.one made were just Brendan's ideas, so we've been trying to figure out how to execute them."
Given the sensitive regulatory environment of the encryption industry, the legal team is overly cautious about every business decision. Between 2017 and 2019, the SEC was bent on prosecuting the companies that organized the IXO. Due to Block.one's disproportionate involvement in running the EOS fundraising effort, these token sales could be considered offerings of unregistered securities. So Block.one was only responsible for its shareholders (including PayPal founder Peter Thiel and investor Mike Novogratz) from the beginning, not EOS token holders.
A report by Bloomberg in May 2019following
followingComedian John Oliver rocks techno-hippie on Last Week TonightAfterwards, Pierce also left the company in early 2018. The failure of Voice (Voice is a $150 million plan to build a decentralized social network on the EOS blockchain) has long been expected, but as Voice Pierce, one of today's dominant players, blamed the failure on the US Securities and Exchange Commission. “Due to compliance and legal requirements, Block.one has struggled to promote the Voice project. Block.one launched the Voice project with great fanfare in May 2019. But the SEC did not allow it to launch tokens, resulting inVoice can only switch to selling NFTs in 2022。”
Block.one's efforts to avoid any legal woes have failed, but that doesn't matter. In 2019, the SEC said Block.one made no effort to prevent Americans from participating in token sales, treating them as unregistered securities, sparking a case that took more than a year to resolve. And the final settlement — tiny compared to the $4 billion IXO$24 million fineIt shocked an entire industry that was watching the matter closely. "Guys, their lawyers are strong." Cryptocurrency investor Katherine Wu said at the timewrite like this. As part of the settlement, the company did not admit wrongdoing.
According to La Rose, while regulatory risk is real, Block.one may have used it as an excuse for inaction. "Block.one used SEC regulation to evade the promises it made," La Rose said. He specifically pointed out thatEOS VC investmentSeveral companies - such as NFT platformImmutableand game companyForte、Playable Worlds— ended up using other blockchains. Even more distressing is that Block.one has invested in projects that hardly promote the EOS system, including Bitcoin mining companies Northern Data and PierceLived since 2018LoopLand, an American Puerto Rico resort hotel.
Pierce said Block.one simply picked the wrong leadership for its VC program. But Michael Alexander, a Hong Kong investment banker who served as the CEO of EOS VC from 2018 to 2020, did say that "the general partners and the people who come to oversee EOS VC are actually more traders, and venture capital is a very difficult task." business, Block.one has never put enough money into the right organization.”
Block.one's EOS VC passedCollaborate with other investorsFunding was deployed, with investors including Novogratz's Galaxy Digital Firm, Asian investors Michael Cao and Winnie Liu, London fund SVK Crypto and German firm FinLab. This approach, the former Hong Kong employee said, is about “outsourcing” the task to a partner, rather than spending time finding companies using the technology that supports EOS. According to the employee, Blumer thought it would be a "distraction from work."
“In the crypto space, it’s the small companies that use EOS, and Brendan isn’t really interested in doing these small ventures.”
Crunchbase data and Block.one's own press release show that Block.oneInjected approximately $675 million into partnerships. But where some of that money went is unclear: According to PitchBook data, in addition to investing $750,000 in crypto trading startup LogoBlock, andTomorrowBC(a firm run by Derek Rundell, managing director of Eric Schmidt's Tomorrow Ventures), the $50 million invested in the partnership is unspent through 2022. Rundell and Schmidt did not respond to our repeated requests for comment.
Following the ENF's ultimatum, on November 10, Blumer and Pierce flew to Canada to meet with La Rose. exista blog post, La Rose said he had been asking for some of the IXO proceeds to go to ENF, but his request was "quickly denied every time."
Just before the meeting,Block.one has transferred 45 million EOS tokens (worth $216 million at the time) to Pierce, in exchange for his stake in Block.one. Pierce told WIRED magazine in November that "I am no longer a shareholder of [Block.one], which means that I have no restrictions, at this point, I am free to do whatever I feel the ecosystem needs." Pierce Suggested on Twitter by setting up an investment company called Helios that will be endowed with newly acquired tokensSave EOS。
However, his status quickly became an issue in the negotiations. Most of the tokens used to buy out Pierce are still in the process of being released. “The network thinks these tokens belong to the network, and Block.one thinks the tokens belong to Block.one,” La Rose said.
After weeks of ineffective negotiations, on Dec. 7, EOS block producers executed a script that halted the release of Block.one's tokens, including those that had been sold to Pierce, effectively preventing him from buying. broken. Ahead of the decision, Pierce told WIRED that such a move would have a "very negative impact on trust" within the EOS ecosystem, so he hopes the action will be dropped.
La Rose felt that Pierce did not make a good final decision and was emotionally unstable in the matter. "He was clearly unhappy, he was angry, he made death threats against me," La Rose said. But when Pierce was interviewed by a Puerto Rican club for blockchain news site Bywire News in late December, hein the background of disco musicSaid he did not recall threatening La Rose and would apologize if true.
"From Block.one's point of view, this separation is pretty clean, now they don't have to worry about the public opinion anymore, they don't really care about EOS, they think it's a waste of time." Larimer and other senior developers People have now started writing EOS code again under the leadership of ENF. The foundation announced grants to companies creating applications for its network.
In La Rose's view, launching Bullish is Block.one's cleverness. "It's one of the legitimate ways they basically took $9 billion."
February 10,A post on ENF Mediumannounced that it has hired a law firm with the goal of holding Block.one accountable for its past actions and breach of promises. An accompanying tweet from La Rose underscored the notion. "Look at all possible recourses to claim $4.1B, let's do it together! #4BillionDAO is coming."
Original link
IOS
Android