The Kin Foundation, established by the billion dollar Kik messaging company, just recently announced that they will be moving from Ethereum to Stellar, after raising millions of dollars through an ERC-20 token ICO last year.

Here are their stated reasons:

- To control their own destiny.

- High and unpredictable fees

- Scalibility

Let's break down these reason one by one and what they mean when in terms of implementing their business model on the blockchain.

To control their own destiny

Kin plans to run and let their partners run, nodes of their network. They do not want their business plan to be unduly influenced by the politics of Ethereum, of which they have little to no control over.

Ethereum could fork or implement technical changes that do not favor the platform.

High and unpredictable fees

Kin plans to set their own fee structure to better fit their business model. That means lower, or no transaction fees to send messages and small transactions fee for other actions. The cost of maintaining unused users account is also a concern for them, since Stellar require a fee for setting up a wallet. Kin does not want to subsidize every account creation fee, since a portion of users might not use the platform even after they've registered.

The unpredictability of fees on the network caused by other applications on the network is also a problem. The success of one application means the failure of another.

Scalibility

Scalibility is a huge problem for an application like Kin, which is an instant messaging application that has to deliver thousands of messages per second.

Ethereum can only handle 15 transactions per second at best, which is orders of magnitude below what is required to run the application.

Another thing mentioned was to have inter-blockchain communication, between Ethereum, Kin and their own blockchain.

One particular interesting thing of note is that users will be able to lock up Kin tokens on one network in exchange for Kin tokens on another network.





Now let's explore how these issues are solved by EOS.





Let's start with scalibility.

EOS, in its beta implementation, can handle a thousand transactions per second, with the promise the released software to be able to handle millions of transactions per second.

combined with 0.5 block intervals and inter-block account communication, messages can be delivered near instantaneously.

Then the Fees.

Fees on EOS network are mostly fixed, with developer reserving RAM on the network to maintain application state. The bandwidth, or the amount of information and Computational power, are based on percentage of total staked tokens, ensuring some baseline of availability. And when the network is not congested, developers can be allocated more bandwidth and computational power than the amount token they've staked, giving them more bang for their tokens.

And lastly, control over one's own destiny. Or Governance.

As a business, Kin does not want to deal with the political issues of Ethereum. If Ethereum forks, then they would have to deal with duplicates of their tokens on two Ethereum networks. The technical development of Ethereum affects every token holder and creator of the network yet they have little to no say in the matter. Ethereum is controlled by its developers and miners, and that is the reality.

Although Ethereum is planning to transition into a Proof-of-Stake system, it is a Proof-of-Stake system that is designed to take power away from token holder by offer a randomizing which staked node gets to validate transactions, they ensure that all the decision-making power remains with Ethereum platform developers.

This reflects the ethos of Ethereum ecosystem where the code is law, and the coders, its lawyers.

EOS.IO software is designed with forks in mind. The software allows developers to implement different variation of consensus algorithm along with a way to include human-readable contracts that binds operating parties to a term of agreement.

This allows application developers to adopt governing principles and provide a formal process to handle update these principles via voting. This way every users and stakeholder have a say, keeping the system decentralize while allowing for political or businesses issues to be dealt with clear guidelines.

A interesting quote from Netanel Lev, Vice President of Research and Development at Kin:

Working this way allows us to make sure we aren’t building technology for the sake of technology, but rather technology that truly serves our product needs.

The Ethereum ecosystem is full of interesting concepts and technologies, and there is something to be said for technological innovation. But what's more important is shaping that technology into something useful for millions, if not billions of people.

Useful links:

Forbe's article on Kik ICO

Kin announcing their own blockchain.

Kin on their reason to launch own blockchain.

Understanding EOS resource allocation.

------------------------------------------------------------------------------------------------------------------

If you would like to know more about me and what I'm doing you can read my introduction post here.

Read my series on the Steem blockchain:

Steem: Welcome to the Matrix. Part One

Steem: Operating in the Matrix. Part Two

Steem: Construction of the Matrix. Part Three

Read my series on the EOS blockchain:

EOS whitepaper walk-through. Abstract

EOS whitepaper walk-through. Note and Disclaimer

EOS whitepaper walk-through. Overview

EOS whitepaper walk-through. Background

EOS whitepaper walk-through. Requirement.

EOS whitepaper walk-through. Consensus Algorithm. Part One, Part Two, Part Three.

EOS whitepaper walk-through. Account construct of EOS. Part One, Part Two, Part Three, Part Four.

EOS whitepapre walk-through. Parallel execution of applications. Part One, Part Two, Part Three, Part Four, Part Five.

EOS whitepaper walk-through. Token model and resource usage. Part One, Part Two.

EOS whitepaper walk-through. Governance.

And you can contact me in the following way:

Twitter

@bluabaleno on Steem.chat

[email protected]