EOS Stealing ETH from Users

EOS Stealing ETH from Users

Many EOS users are complaining that their wallets are getting invalidated due to several rules enforced by its constitution. Also, users are not getting moved to mainnet if they do not registered their accounts before the deadline. They are calling it “Outright Theft” of their ETH.

Disconnect Between ERC20 and EOS Mainnet

Many users bought their ERC-20 token many months ago and had placed them in cold storage. But at the last minute users were asked to “Register” to be included in the mainnet. Many users who were not aware of this Registration were too late, and they were left out of the mainnet.

Some Community members tried to help them recover and move them to mainnet using the fallback mechanism (i.e., doing reverse engineering and recovering token keys from their ETH private keys that they used to buy the token). Some users were finally able to recover their tokens without any help from block.one team. But imagine a normal layman who bought the token and was still storing it in the wallet without knowing that he needs to register to be part of mainnet. Also, not everyone can perform this complex recovery that involved exposing your private keys, and that needs to be done on an offline computer.

Users Face Loss of EOS Tokens

Many users also complained that they were unable to register to tokens due to lack of at least one single outgoing transactions from their cold storage. The ETH address from where they bought the ERC20 token must at least have one “Outgoing Transaction“. Users were not aware of this information also, and they were unpleasantly surprised when they found out that they were unable to vote because they can’t add their identity to the account. This is unacceptable because users store their tokens in cold storage so that they remain offline and no transactions are carried out from that wallet for safety. But EOS constitution forcing users to do at least one outgoing ETH transaction is an “Outright Theft” of their ETH.

Average Joe Suffers

Average Joe who holds EOS tokens will be clueless about this highly complex system and will eventually miss out and lose his funds entirely. This is the reason EOS token holders accuse Block.one (Block.one is funding EOS.IOS platform) of stealing their ETH from them. So the tokens that they bought by exchanging for ETH is lost forever but will be held by the EOS team. Only tech-savvy people can recover the tokens and successfully register to the mainnet.

Block Producer Can Help recover

According to EOS.IO blockchain constitution (EOS has set of rules governing its blockchain), there is a concept called Block Producer. Block Producers will be decentralized entities governing the EOS.IO blockchain. Some experts point out that a block producer can help in the recovery of users’ tokens, but it is pathetic for the holders to be at the mercy of the block producers. These rules will lead to centralization, and the core concept of permissionless blockchain is broken. Bitcoin was created by Satoshi to make it decentralized from the government and other central authorities. But EOS is taking us back to the same central authority and enforcing inbuilt rules that are trying to govern its users.

Outright Theft

Users buy many ERC20 tokens, and so they cannot keep a connection to every single token and perform a much complex registration process to avoid losing their tokens. If they buy an ERC20 token it should forever be available to them, and it should readily be converted to the mainnet, otherwise, it is an “Outright Theft.” Users accuse that this is an indirect way to steal their ETH by Block.one by enforcing complex process to register to the mainnet.

Twitter Celebs Accuse EOS

Many twitter celebs accuse EOS of stealing ETH from the users, and they were also not comfortable with the EOS having the constitution that allows them to control their users. Below are some of the tweets from some of the crypto celebs.

Jackson Palmer (Creator of Dogecoin) revealed that block producers froze several accounts, below are his tweet.

Nick Szabo also accused EOS to have “Constitution,” and he dropped the bomb that any stranger can freeze user’s money as per the EOS protocol. He also pointed out that the Constitution has several security loopholes. Below is his tweet.

We need to wait and watch if EOS.IO blockchain can relax its rules and provide a permissionless and decentralized blockchain for it to be accepted and adopted by the majority of the people.