Photo by Anthony Garand on Unsplash

Well folks, read all about it. EOS Block Producers (“BPs”) froze accounts “violating its own constitution.”

Not really.

The charge comes in like that of an overzealous prosecutor who only needs to toss in a few allegations — regardless of merit — to influence the court of public opinion.

The Short Answer

Punchline: the reasons why it is not a breach of Constitution: (i) it is not a final settlement, nor a civil matter, as per the article dealing with Arbitration; (ii) a proper Arbitration body would likely not rule on this matter because it lacks jurisdiction; (iii) the real issue is the right to property, which is addressed in Article III; and (iv) the unanimous vote of the BPs grants the exception of rights prescribed in Article III.

Following this line of reasoning, the freeze and the process followed was constitutional.

The Charge

Let’s analyze it: Article IX of the current Constitution states:

Article IX — Dispute Resolution All disputes arising out of or in connection with this Constitution shall be finally settled under the Rules of Dispute Resolution of the EOS Core Arbitration Forum by one or more arbitrators appointed in accordance with the said Rules.

The issue is: the use of “finally settled;” which is not the case here… this is clearly an ongoing matter yet to be settled.

As an aside, this is hints at civil matters between two parties with the use of the term “dispute.” The Law distinguishes between criminal matters and civil matters: civil is between two persons, criminal is between an accused and the State. Given that the matter cited is involving theft, this is in the realm of criminal, not civil. Given this, it is possible that an arbitrator would elect not to hear this case on the basis of lack of jurisdiction.

Interim Measure

In the legal world, there are several interim measures available to the court prior to the judgement. The most used is the injunction; which limits rights of a party in the dispute. In our case, the freezing of the account.

This is generally decided as an ex parte hearing (i.e. decided without the knowledge or notice of the person at issue) — for the obvious reason that the accused might abscond (i.e. run away with the funds).

The point to remember here is: freezing an account is an interim order — not a judgement, and hardly a final settlement.

Due Process

A more relevant provision comes from Article III:

Article III — Rights The Members grant the right of contract and of private property to each other, therefore no property shall change hands except with the consent of the owner, by a valid Arbitrator’s order, or community referendum. This Constitution creates no positive rights for or between any Members.

Article III grants the right of property and contract, but sets its limits. Notice the exceptions, which include “community referendum.”

One could reasonably presume that for urgent matters, that the representatives with the most skin in the game would be called to vote: the BPs.

Noting that all 21 BPs did vote unanimously to freeze the said account — it becomes harder to justify the view that the freeze was not done in due process.

In Formation

The charge of “violating the constitution” makes even less sense considering that the Constitution is clearly a work in progress.

Plus, Larimer’s vision for EOS (and for his previous projects as well) is not to build a finalized platform, rather to build an adaptable one.

Parallel this to the United States’ Constitution: amendments has been made, constitutional crises have been weathered.

The pains experienced in the procedure and its evolution the cost of adaptability and the price of freedom.