EOS community halts payout of $230 million to Block.one

The EOS community has decided to halt regular payouts from Block.one, the company behind the project, saying that it no longer acts in the network’s interests.

The vote halted the issuance of 67 million EOS tokens (around $234.5 million), which were due to be distributed over the next six to seven years. The move also affected Tether cofounder Brock Pierce. Almost half the sum was slated to be directed to his latest project.

“With the overwhelming majority’s consensus, the EOS network has taken its future into its own hands, voting to strip Block.one of its tokens and halt transfers to it. This opens a new era for EOS and underscores the power of blockchain to enable a community to stand up against corporate interests that do not align with its own,” said Yves La Rose, head of the EOS Network Foundation.

In 2018 Block.one raised $4.2 billion in an ICO to launch the network.

For backing the project, Block.one was due to receive 100 million EOS (around 10% of the supply) over 10 years. According to the EOS Network Foundation, in the following years the community grew dissatisfied with Block.one’s commitment to the blockchain in terms of real-world use cases.

The company launched the social network Voice, but it turned out that it did not run on EOS. The later-founded Bitcoin exchange Bullish also does not use the main network.

In August 2021, EOS stakeholders and block producers formed the EOS Network Foundation. It was led by La Rose, formerly head of the block producer EOS Nation.

In a prepared speech, he said Block.one had let EOS down and that a new path for the project’s future development was required.

The Foundation sought from the company the transfer of intellectual property rights to EOS. Instead Block.one promised to grant the EOS Network Foundation 30 million EOS.

As a result, block producers voted to discontinue regular payouts to the company.

Following the community’s decision, the EOS price jumped from $3.18 to $3.89. At the time of writing, the price had retraced to around $3.50.

Earlier analysts detected signs of manipulation in the project’s ICO.

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