A sensationalist claim appeared in an article on SludgeFeed - EOS is supposedly organizing an attack on ETH network by spinning off random unbacked token airdrops.
We know something about useless token airdrops, that’s how our #DeadParrot #Crypto section came to exist:
- Many cryptocurrencies that were given away to people in exchange for social media work are now becoming useless token spam.
- They will never get listed on a digital currency exchange, some may exit scam, some will barely survive for a relatively long time but indeed so barely that they will be considered dead anyway.
Token airdrops as affordable marketing
The social media following built via the token giveaway will be laid aside for a while, then it will get rebranded and reused. Token drop is a cheap way to build a user base, and a reliable one at that: Tech enthusiasts love the idea of being gifted a digital token that could potentially be worth a fortune one day.
No matter how many times you squeeze it, there will be the juice.
The current popularity of ERC20 standard Ethereum token airdrops has brought the same critical response as we have seen in 2017 when Bitcoin forks were all the rage: It is not a free lunch.
- The endless transfers of coins are flooding the network
- People want to transfer quickly before a random deadline goes so they will set an extra high fee
- The result is costlier and slower network for everybody
In the case of Bitcoin the fork resulted in a chain split but a BTC transfer was needed for security. In the case of an ETH token airdrop, the tokens transact on the Ethereum network. The negative consequence of flooding the blockchain is present as well.
What has EOS to do with ETH gas prices?
The blame for token spam was first thrown on EOS in an article on TrustNodes.
The factual backup for this theory is based on confluence of events only, though:
- Leading up to the EOS mainnet launch on their own blockchain and move away from the ETH blockchain, the ETH network activity was rising
- Also leading up to the EOS mainnet launch there was a lot of dodgy token airdrops that were hyped up on social media (just as there is now)
It is undeniable that the EOS mainnet launch had some effect on the Ethereum network but it being the case that cryptocurrency speculation is a major part of the network activity and considering that claiming the EOS tokens on EOS blockchain required identity registration, a lot of traders were looking to take their EOS pre-launch hype profits. That naturally resulted in a lot of activity on the ETH blockchain.
The blockchain.info chart of total exchange traded volume stats shows the activity at the end of May 2018 and around the June 6th date of EOS launch was indeed spiking:
On the other hand, the EOS attacking ETH conspiracy is fueled only by a single reported incident - a token airdrop being closely related to an ETH address that received a lot of crowdfunded EOS.
While both token airdrops and the EOS mainnet launch have had some impact there it is by all means a stretch to call out EOS airdrops as the reason for rising gas prices on the ETH network.
The crypto airdrop hype is likely to cool down in time as people will get progressively disillusioned with their tokens becoming useless and perhaps we will get back to the good old 2016 model of earning tradable cryptocurrency for actual work.
Data is beautiful
Comparing Forex Market with Cryptocurrency Markets (Infographic)
One of the few metrics that cryptocurrency markets have in common with the forex markets in 2018 is the high percentage of total trades being located on few most popular markets.
Blockchain Technology 101: Blockchains, Blocks and the Role of Price [Infographic]
Blockchain technology 101: What is blockchain, what types of blockchains exist and what role does the cryptocurrency price play.
Real-world companies that accept crypto payments [Infographic]
Infographic - Graphic map of businesses that let customers pay in bitcoin.
Infographic: Blockchain Hacks & Crypto Trading Platform heists 2018 vs 2017
Blockchain infographic comparing the biggest crypto heists of 2018 and 2017. In 2017 the focus lied more on ICOs, smart contracts and wallet.
15 crypto kings that are making history with their engagement in the field of cryptocurrencies
Coining The Bucks With Cryptocurrencies Have you ever wondered how much masters of the cryptocurrencies are worth? Like the guy who founded Ethereum, or the one who started Ripple, for example. The answer, in short,...
The Good And The Bad Of ICOs
Infographic: The good and bad of ICOs - Which token sales raised the most money in 2018?
Industry News Releases
Open Data Exchange announced an important milestone: a commitment of more than 60 MM USD...Read >>
- Zilliqa announced blockchain grants for technology developers
- Wyre acquired Hedgy, platform for smart contracts on Bitcoin
- Etheremon launches new game mode that gives players full control of their in-game assets
- Fintech company Nexo offers to buy SALT Lending
- Universal Protocol - new platform for practical interoperability of blockchains - gets backing of capital asset management firms
- Blockchain KYC Platform traceto.io Partners with Yincubator