Any day now Block.one will start casting its votes for Block Producers. By some coincidence (probably not) we’re starting to see a lot of activity coming from our Block Producers leading up to Block.one’s participation in the governance of the EOS network. A vote from Block.one cannot guarantee a top 21 position for any Block Producer, but it can be of great impact when it comes to voting a BP into the top 67 paying positions or even moving them up that pay ladder.
Block.one’s 9.5 percent stake in EOS tokens is small enough to not decide the top 21 but big enough to make some shifts in the BP standings. The latter is enough reason to either cause panic for BPs who’ve made little contributions for the network, or create excitement for those BPs who’ve made great contributions to EOS yet are just short of a paying position. Just because Block.one can’t vote out a BP that’s in the top 21 that doesn’t necessarily mean a BP that’s at the top of the standings should feel comfortable about their position. That’s what I’m most excited about!
There’s no other company that has as much influence on the EOS community as Block.one does. Even though they have little of direct influence on EOS itself or its governance, there is an indirect influence that comes as a result of the community’s perception of them. It is this indirect influence that can move mountains within the standings of the Block Producers – to an extent where the first positioned BP may not be as secure as one might’ve thought, at least not in the medium to long term. BPs are aware of this influence which is significant for Block.one’s contribution in creating a fairer and more efficient EOS governance.
The beauty of EOS governance is that its elected Block Producers are elected to represent the wishes of the community. We have BPs that create innovative tools for the network, BPs that help on-board new stakeholders into the network, and BPs that are great in merging community with governance, et cetera. Each BP is stronger in some areas than others, but the top 21 BPs need to be the most capable overall.
Block.one on their own won’t as much of an influence on EOS governance, but together with the EOS token holders they’ll both have a strong enough influence in really steering the network in the direction we all wish to see EOS headed. The relationship between the token holders and Block.one will need to be its strongest in order to make the EOS ecosystem as valuable as it can be. Block.one has resources that other community members don’t and if these are shared or communicated efficiently, then the community’s voice will be amplified. But that aspect is a job for their Public Blockchain Engagement division.
A couple days back Block.one published their voting criteria for BPs which emphasized on voting for BPs who make valuable contributions to EOS. Their criteria is very much aligned with that of the token holders, and since Block.one has the resources to research and seek out value adding BPs, then token holders are likely to duplicate those same BP choices. That is the indirect influence Block.one will have – the role of an influencer whose actions are closely followed by supporters. Block Producers are evidently fixing to be among the chosen ones, not only by Block.one, but also the trailing votes that will likely follow them.
In anticipation, Block Producers have aligned themselves with the voting criteria set by Block.one and have been announcing some useful contributions leading up to Block.one’s deadline on May 22. In the last 12 days alone we’ve had announcements of a BP Kicking Proposal Monitor, a Rating System for Block Producers and Proxies, and a new version of the Hyperion history API. These are all great contributions from some of our best BPs and I’m sure we all want to see more of this from more BPs going forward. We’re seeing other BPs become more active and involved with the community thanks to Block.one’s decision to vote.
Block Producers that are just collecting rewards and not making valuable contributions to the network will soon be replaced by more competent ones. I think we are headed to a point where, we not only see Block Producers as independent companies in which we’re board members through our votes, but also a point where they themselves start operating like companies that have board members backing them. If a company is under-performing, then we as board members (voters) sell our shares and buy shares of a different company. This is most likely the approach Block.one will take when deciding which Block Producers to cast their votes for.
The best EOS companies (Block Producers) will be those that branch out beyond just producing blocks on the EOS blockchain. It will be those who re-invest their EOS rewards back into their companies so they may become contributors who provide even more value to the network. Beyond May 2020, competition is certainly going to get tougher as more entities realize the value of the EOS token and its ecosystem.
Most of the BPs we’re familiar with today will not be around in the coming years as they fail to keep up with new entrants to EOS governance. Institutions are the next Block Producers and will have more to contribute because of their diverse connections in different industries, thus it is vital that current BPs devise plans to become institutions themselves. On top of that, big institutions also have the ability to buy themselves a decent stake (tokens) to help them get into a paid position. BPs who fail to evolve now won’t be able to compete with such valuable contributors who may be popular with token holders/voters.
Take popular gaming company Ubisoft for example, they are a BP on UOS (Ultra’s blockchain) and could easily decide that its in their best interest to become more involved with EOSIO by branching out into a Block Producer role on the EOS network as well. That’s one more spot taken by what would be a quality company (BP) that has much more to offer the ecosystem. Same thing happened when Binance, one of the biggest cryptocurrency exchanges in the world, saw value in EOS and decided to take up the role of a BP. That’s where we’re headed; as the EOS network continues to grow, more influential companies like Block.one and Binance will start participating in its governance in order to safeguard their long term interests.
Value for token holders
As a token holder I encourage this kind of tough competition within the network and wish for it to begin sooner rather than later. For one, it’d be a shame for a BP that helped launch the blockchain to be in a position where they’re no longer relevant all because they slacked off. Secondly, this tough BP competition will lead to more quality contributions that create value for the EOS token. Thirdly, it will create a greater demand for the EOS token because now, due to this increased competition, people will start voting for their favorite BPs like they do a trusted politician or a favorite sports team.
In this environment it will become clearer that the EOS token represents power that grants its holder the ability to influence change. A power that many organizations will want and would be willing to spend incredible amounts of resources in order to acquire it. Current Block Producers are in a unique position because they also happen to be some of the biggest token holders of EOS at the moment. Do they hold, sell, or reinvest their holdings? That all depends on the strategy each Block Producer has. However, the best strategy has got to be the one that secures their future on this valuable network, while being a sitting duck that contribute very little is a waste of valuable time that can never be regained.
as a final thought…
Time is running out, not only for Block Producers, but for token holders as well. All EOS stakeholders need to secure their positions for the impending future and use their advantage as early adopters to do so. Block.one’s participation in EOS governance signals a change, or rather, the start of a chain reaction of events that will ultimately lead to a much more competitive and valuable EOS network. As a token holder, what is to follow should be a great unraveling of events to witness. As a Block Producer, life on EOS is becoming more worrisome, things are heating up and it is time to raise personal standards. Whichever side you fall on one thing is for certain, the window of opportunity is closing.
Thank you for reading!
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