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A top 10 cryptocurrency (by market cap), EOS is the token of the blockchain app development platform EOS.IO, created by Hong Kong-based startup block.one. On top of being responsible for a crypto with a market cap in the billions, block.one is also a pioneer in the blockchain space, as it is one of the companies working towards the promotion of decentralised apps (DApps), smart contracts and other pragmatic blockchain uses.
Like many other cryptos, EOS is exposed to the ebb and flow of the cryptocurrency market. However, the practical uses of the EOS.IO platform give it more depth. Similar to Ethereum and NEO, EOS.IO is aiming to be a significant player in the blockchain space, by creating a benchmark platform for utilising the technology’s advantages. block.one generated a lot of attention when it successfully raised more than $2 billion in an ICO.
Cryptocurrency traders: Being a top 10, multi-billion-dollar crypto, EOS could be a welcome addition to those who wish to diversify their cryptocurrency-based portfolio.
Blockchain enthusiasts: Since block.one is aspiring to create a platform for blockchain developers, those who believe the technology will have a significant impact on the market could consider investing in EOS.
Long-term investors: The crypto market has known its ups and downs. However, those who have faith that the market will continue to climb in the long-run could buy EOS and hold it as a long-term investment.
Day traders: Like most cryptos, EOS could experience significant single-day price swings, sometimes in the double-digits. Traders can take advantage of this volatility in an attempt to generate short-term profit.
There is a variety of factors that can impact the EOS token’s price. The factors range from general trends in the crypto market, through global financial trends, to events relating directly to the cryptocurrency. Moreover, since EOS.IO is a blockchain development platform, it can also be impacted by factors relating to the expansion and adoption of the technology. Here are some factors that can affect the EOS chart.
Bitcoin: The first and largest (by market cap) cryptocurrency has significant weight in the crypto market and is still considered the benchmark by which all other cryptos are measured. Therefore, a large movement in BTC prices could impact the rest of the market, including EOS.
Financial market volatility: While still separate from other global markets, the cryptocurrency market is sometimes regarded as a safe haven when other markets become too volatile. Therefore, at times of crypto stability and mainstream market volatility, EOS could be in high demand.
The blockchain industry: As the blockchain industry becomes more widespread, a growing number of companies are embracing the new technology. If EOS.IO succeeds in establishing itself as a prominent DApp development platform, the EOS token could go up in value.
Mainstream acceptance: The crypto market is still on the fringe of mainstream markets, with the general sentiment towards it constantly changing. Many times, a major financial institution will come out in favour or against the crypto market, generating volatility and impacting many cryptos, including the EOS price.
When the EOS token was first introduced in July of 2017, it was part of a multi-faceted plan to roll out the EOS.IO DApps development platform. By holding an ongoing EOS ICO, block.one continuously distributed its token, to ensure that it will be held by many people when the platform rolls out. By creating a community before releasing the platform, the startup made sure that there would be enough people around the world that can use the platform from day one.
While there is often criticism of the ease of holding an ICO without offering real value to a newly-launched cryptocurrency, block.one’s strategy was designed to give would-be DApp developers the promise of early access to its platform. Alongside Ethereum and NEO, EOS.IO is aspiring to become a major player in the blockchain development space, by enabling its users to create apps using the new technology with relative ease.
The EOS.IO platform and its EOS token were first unveiled in a white paper released by block.one in 2017, detailing the DApps development platform and the EOS blockchain network, which was said to be designed for fast transactions and extreme scalability. Following the release, the company began distributing the coin via an Ethereum-based ICO, raising more than $2 billion, which accounted for more than 5% of the total circulation of Ether at the time.
Despite saying that ICO investors will not be receiving any part of the company and will only be given the EOS tokens, the ICO could be described as a massive success. Moreover, the fact that EOS quickly rose in market capitalisation to become a top 5 cryptocurrency at some point shows the faith the crypto community has had in the Hong Kong-based crypto. Whether that faith is more related to the promise of the EOS.IO platform, or the potential of the EOS token to rise in value, remains to be seen.
It is not uncommon for cryptocurrencies to rise in price and popularity, even if all they have to offer is the currency itself. Bitcoin, Bitcoin Cash and Litecoin are just some of the examples of cryptos that can be used as a means to transfer funds, but nothing more. However, EOS is a different kind of crypto, since it is part of a platform for blockchain development. Joining giants such as Ethereum and Ripple Labs, block.one will try to establish itself as another major player in both the blockchain and cryptocurrency spaces. Creating a community of EOS holders before even launching the platform gives the company a firm foothold in the crypto market and could contribute to its long-term sustainability and success.
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*Past performance is not an indication of future results. Your capital is at risk.