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The EOS PowerUp Model Explained

Overview

How public blockchains allocate and manage on-chain resources is extremely important. Some networks operate on the basis of transaction fees, where prices go up as more people try to transact. Those fees are collected by miners. The EOS Public Blockchain has a different model that involves locking up EOS tokens to reserve resources. On the EOS Public Blockchain, there are three resources that matter: CPU bandwidth (CPU), which is the amount of time it takes to process a transaction, network bandwidth (NET), which is the size of a transaction measured in bytes, and RAM, which is the method for storing data on-chain measured in bytes. We’re going to talk about CPU and NET and how we propose to evolve them moving forward.

Currently, EOS tokens are referred to as owning digital real estate. Owning a percentage of all EOS is likened to controlling a percentage of the total resources on-chain. When a user locks up their tokens, they reserve a percentage of the total available resources. The amount of CPU and NET each user receives was proportional to the amount of tokens they had locked up. If you have 1% of tokens, you have 1% of resources.

There Were Challenges with this Model

  1. Resources sitting idle: Not everyone locks up their tokens to access resources. Some lock up their tokens for additional security, while others do it solely to vote. Regardless, resources are still reserved when a user locks up their tokens. Those resources sat idle even if others wanted to access them.
  2. Barriers to obtaining additional resources: Users that try to transact but find that they don’t have enough resources to do so are presented with three options:
    • Purchase more EOS to transact – This is time consuming and not a good experience if a user is merely trying to accomplish a transfer or something similar.
    • Obtain resources from the Resource Exchange (REX) – The amount of resources available from REX have depleted multiple times in the past. It’s not clear if there is enough liquidity in REX to support resource allocation needs across the network.
    • Use a wallet that covers resources – This is a good solution, but these wallets may not be known to new users. In addition, many of these wallets rely on REX. which brings us back to the liquidity issue above.
  3. New user costs: Obtaining additional EOS to reserve resources is cumbersome for reasons mentioned above.

We’re proposing the next evolution to this model.

A Community in Sync

Since Fall 2020, Block.one has engaged with the rest of the EOSIO developer community to evaluate a newly proposed model for how the EOS Public Blockchain allocates CPU and NET resources. We call this the EOS PowerUp Model and believe it provides greater freedom and efficiency for the EOS Public Blockchain. We provided a bug bounty program and Block Producer voting program to incentivize engagement with the code. At the time of writing, over 250 individuals have joined in the conversation on Telegram and over 40 Block Producer candidates have provided feedback, all of which has been positive. Of the bug bounty submissions, none identified any vulnerabilities.

We’d like to acknowledge the entire community who participated in the discussions that resulted in the proposed EOS PowerUp Model window being shortened from 30 days to 24 hours. We also acknowledge EOS Authority for a suggestion that resulted in a code change.

The Model Explained

The EOS community has done an excellent job at breaking down how this new model works. EOS Vibes, an EOS Block Producer candidate, explains it like this:

The EOS PowerUp Model presents the user with two choices:

  1. Pay a small fee to power up your account for 24 hours with CPU and NET bandwidth that you can use to fulfill your transactions needs.
  2. Deposit your idle tokens to receive a percentage of the fees generated by the entire EOS Public Blockchain.

Imagine if token-holders on proof-of-work networks were the recipients of fees generated by transactional activity on-chain, instead of miners. That’s essentially what’s happening here. Depending on your usage level and the total amount of tokens deposited, the fees you collect may offset the fees you pay to power up your account. And all of this happens within the context of ensuring greater availability of system resources.

Creating Amazing UX:
The Future of Resource Providers

A shared vision within the EOS Public Blockchain ecosystem is that EOSIO is robust enough of a development platform to support seamless user experiences. This vision imagines that on-chain resource management is abstracted away from the end-user to the point where their experience is indistinguishable from a typical application. We believe that vision can be achieved through resource providers, which we view as middleware that dynamically and efficiently meets the resource needs of users. This middleware can be offered by a third party or by the end-user applications. However, the way the EOS PowerUp Model fees are handled is up to the providers and the applications. We encourage EOS community members to help spur development of open-source SDKs that enable easy resource provider integration within end user experiences. Please reach out to us if you are working on such a solution.

Driving this Forward

We believe that the EOS PowerUp Model alleviates many resource challenges on the EOS Public Blockchain and seeks to increase alignment between token holders and usage of the EOS Public Blockchain.

It is our expectation that, similar to the EOSIO 1.8 consensus upgrade that occurred in Q3 and Q4 of 2019, leadership from within the rest of the EOS community will emerge to lead the development, deployment, and adoption of the EOS PowerUp Model. We look forward to participating as a member of the EOS community.

For the technical explanation of the proposed EOS PowerUp model, please read the EOSIO Resource Allocation Proposal

Important Note: All material is provided subject to this important notice and you must familiarize yourself with its terms. The notice contains important information, limitations and restrictions relating to our software, publications, trademarks, third-party resources and forward-looking statements. By accessing any of our material, you accept and agree to the terms of the notice.

Important: All material is provided subject to this important notice and you must familiarize yourself with its terms. The notice contains important information, limitations and restrictions, relating to our software, publications, trademarks, third-party resources and forward-looking statements. By accessing any of our material, you accept and agree to the terms of the notice.

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