Guide to EOS trading for beginners

EOS appeared on the crypto scene with a record-breaking ICO that raised over $4 billion dollars for the development of the blockchain venture. Today, EOS is one of the leading blockchain networks in the market. EOS is a decentralised blockchain platform for developing dApps. It provides authentication, authorisation, and accounting services to users. EOS is similar to Ethereum but offers faster transactions and higher scalability.

Read on to learn everything you need to know to know about EOS, from its multi-billion dollar token sale to how you can trade EOS crypto CFDs with Axi.

What is EOS and how does it work?

EOSIO is a blockchain platform that enables developers to execute smart contracts and create decentralised applications (dApps). EOS is the name of the network’s native token. The goal of EOS was to create a platform where developers could build decentralised applications (dApps) with common programming languages like C++. That means that developers can use the platform without learning a new language. That’s not the case with Ethereum, for example, which requires developers to learn Solidity.

Furthermore, the EOS blockchain offers scalability and zero transaction fees. That makes it a competitive alternative to market-leader Ethereum, where developers pay high gas fees to test and deploy applications. 

In addition to using EOS to pay for transaction fees and to deploy dApps, EOS token holders have the right to vote for the representatives that validate transactions (block producers).

Why has EOS become popular in recent years?

EOS gained popularity after raising $4.1 billion via a year-long ICO that ran from 2017 to 2018. The ICO attracted investors like hedge fund moguls Alan Howard and Louis Bacon and PayPal co-founder Peter Thiel. The EOS ICO was the largest token sale in history.

Moreover, the project rose in popularity on the promise of becoming an Ethereum “killer”. However, while the EOS blockchain can deliver more transactions per second than Ethereum and has zero transaction fees, it has not (yet) gained anywhere near the amount of transactions of its pioneering predecessor.

When was EOS created?

EOS was launched in 2018 by Block.one. David Larimer and Brendan Blumer established Block.one in 2017. The project was funded through an ICO that lasted a year. Interestingly, the ICO was launched on the Ethereum blockchain in 2017 with the sale of an ERC20 token. The EOS token later migrated on its native blockchain once the EOSIO mainnet was launched in June 2018.

Who invented EOS?

Larimer and Blumer are the minds behind EOS. They both authored the EOS whitepaper and held executive positions on Block.one. Blumer is still the company’s CEO while Larimer was the CTO until he left on December 31, 2020. Larimer has since returned to continue working on EOS. 

Blumer is a serial entrepreneur and the co-founder of a digital-focused real estate company called Okay.com. Larimer is a software engineer who launched the Steem blockchain and Bitshares, two innovative crypto projects at the time.

How does EOS mining work?

EOS uses a delegated Proof-of-Stake (DPoS) consensus mechanism, a concept that Larimer created. DPoS is a system that allows token holders to participate in the election of block producers. During every block producing round, 21 block producers are chosen. Unlike proof-of-work (PoW) where miners compete to find blocks, EOS block producers have to work together. Block producers have to produce a minimum of one block every 24 hours or they’re punished. This system helps to keep block production regular and to maintain a block time of three seconds.

EOS price history

The price of EOS has mostly hovered between $2 and $10 since its launch. Let’s take a look at some of the token’s most significant price movements. 

• October 23, 2017: EOS reached an all-time low of $0.5. As of February 2, 2022, the cryptocurrency is up 388.91% since then. 2017 was the last time EOS recorded prices below $1.
• April 29, 2018: EOS hit an all-time high of $22.89. The token ranked among the top five cryptocurrencies with a market cap of $17 billion.
• December 2020: EOS dropped by about 15% over 24 hours to a low of $2.93 after Larimer announced his departure. The price later recovered to around $3. 
• May 12, 2021: The EOS price hit $14.88 after Block.one announced plans to establish a blockchain-based cryptocurrency exchange, called Bullish. This is the second-highest price that the coin has reached to date.

What is the market capitalisation of EOS?

EOS has a market capitalisation of $2.3 billion as of February 2, 2022, ranking it the 48th largest cryptocurrency by total market value. Several block explorers allow users to view EOS transactions. They include Bloks, EOS Flare, EOS Authority, and EOSX.

You can visit any of these sites to view your EOS transactions. You’ll need your transaction ID to check your transactions.

Now, let’s take a look at how you can buy, trade, and invest in EOS.

How to trade EOS

You can trade EOS on any crypto exchange where the token is listed or on an online trading platform, like Axi, that offers cryptocurrency CFD trading. An EOS CFD (contract for difference) enables traders to speculate on the price of EOS. A broker and investor enter into a contract agreeing to pay the other party “the difference in the value of an asset between the opening and closing of a trade".

Before trading EOS, follow these steps:

• Conduct thorough research to find the best ways and places to trade EOS. You’ll also need to learn the basics of trading if you’re a beginner.
• Learn about the price movements of EOS.
• Create a trading strategy.

Once you’ve followed the above steps, create an account with Axi, deposit funds, and start trading. Don’t forget to regularly monitor your trades and review your strategy.

How to invest in EOS

Investing in EOS means adding this digital asset to your investment portfolio. You can buy EOS tokens on a reputable cryptocurrency exchange and then transfer them into a personal cryptocurrency wallet for safekeeping.

You can buy EOS from any crypto exchange that has listed the crypto asset. What you need to do is: 

• Sign up for a crypto exchange.
• Deposit the amount of money you want to buy EOS tokes with.
• Place an order to buy EOS.
• Wait for the order to be filled and receive your tokens in your exchange wallet.
• Transfer your EOS to a personal crypto wallet. 

How to store EOS

Storing EOS safely is important for every investor. If you’re storing EOS for the long term, consider acquiring a cold wallet, like Ledger Nano X. For the short term, however, you can use a hot wallet, such as a mobile or web wallet. Examples of wallets that support EOS are Atomic, Exodus, Infinito, Lumi, Guarda, GreyMass, Edge, and Scatter.

Advantages of EOS

Discover the advantages and disadvantages of the EOS blockchain platform below:

• Easily accessible: Anyone with an internet connection can buy, sell, hold, send and receive EOS. 
• Highly scalable: The EOSIO blockchain is known for its scalability. It can process 10,000 transactions per second, compared to Ethereum’s 15 transactions per second.
• Zero transaction fees: It’s free to send and receive EOS. 
• Easily upgradable: Developers can upgrade dApps easily. The fact that developers don’t have to learn a new programming language is a plus.

Disadvantages of EOS

• Potential for dominance by large nodes: Block producers need a lot of resources in the form of money and data centre infrastructure to participate in the EOS ecosystem. Therefore, this could lead to large organisations controlling a large part of the network, making the project vulnerable to centralisation.
• Power struggles between EOS Network Foundation (ENF) and Block.one: ENF (which essentially represents the EOS community) wants to cut ties with Block.one, which controls the codebase. Dan Larimer has reportedly returned to the EOS project to work on the Mandel upgrade that will give ENF control over the codebase.
• Vulnerable to shut down: A block producer is essentially a company-owned server that a government can shut down.

What price is EOS expected to reach?

While numerous online trading blogs predict that the price of EOS will rally this and next year, the reality is that it’s incredibly difficult to predict how a cryptocurrency will perform in the short and medium-term. Making a long-term price prediction for a crypto asset like EOS is even more difficult.

The success or failure of EOS will depend on whether the EOS community can manage to attract developers and businesses to start building products and services on the chain.

Since EOS is in fierce competition with other smart contract-enabled blockchains, it won’t be easy for EOS to reach past its previous all-time high. Unless, of course, the crypto market experiences another incredible bull market like it did in 2017 and 2021.