Block.One CTO: Arbitrator Controversy Damaged EOS Community

David Floyd
Jun 27, 2018 at 17:30 UTC
Updated Jun 27, 2018 at 19:18 UTC
NEWS

The CTO of the company that developed the protocol behind the EOS network has called for a much-reduced role for the controversial dispute arbitrator that has monopolized the attention of the EOS community in recent days and drawn significant outside criticism.

“My official opinion on disputes regarding stolen keys is that no action should be taken,” Dan Larimer wrote in an EOS Telegram channel Tuesday in reference to the EOS Core Arbitration Forum (ECAF). “The producers should campaign on using some of their pay for donations to make the victim whole.”

Larimer was referring to a recent order issued by the arbitrator, which required the EOS network’s block producers – the 21 validators who maintain the blockchain in a way analogous to bitcoin’s miners – to freeze 27 accounts that had been compromised by hackers or scammers.

ECAF’s action attracted significant criticism: on the one hand, from observers who felt the order violated the principle that cryptocurrency payments should not be subject to censorship; on the other, from EOS network participants who felt that ECAF’s processes were haphazard and unprofessional.

When a fake order claiming to be issued by ECAF circulated over the weekend, a top block producer refused to acknowledge such orders until the process had been reformed.

“Bottom line,” Larimer wrote Tuesday, “damage to community from ECAF is greater than funds we hope to restore to users.”

It’s not clear whether he was calling for ECAF to be eliminated entirely or for its role to be limited. He cautioned against allowing ECAF to become “a regulatory body of undefined and unpredictable power.”

On the other hand, he indicated that he still sees some place for arbitration on the EOS network.

“Arbitration should be limited to correction of intent of code,” he wrote, adding: “Freezing should be limited to code not function at intent.”

He said he would publish a blog post detailing his thoughts on Wednesday. (Update: shortly after this article was published, Larimer posted a blog entitled “The ‘Intent of Code’ is Law.”)

Governance pains

Larimer’s comments echoed a persistent thread of criticism in EOS social media forums: that governance – a central part of the network’s ethos and reason for existing – should all happen on the blockchain, rather than through ad hoc methods like screen grabs of PDFs shared on Telegram (such haphazard communication made it difficult to immediately discredit the fake ECAF order issued over the weekend).

“All governance by smart contract,” Larimer wrote. He continued (asterisks in the original):

“*if it can be solved by tech, then it should be solved by tech*”

For the most part, Larimer’s comments were well-received. Many participants in the chat complained about ECAF: its sloppy methods, its outsized power and the way it distracts from what they see as EOS’ world-changing potential.

Some users pushed back on Larimer’s proposals, however. “The ability to recover stolen funds and not have to worry about hackers was a big selling point” of EOS, one wrote. “It’s not possible without ECAF.”

Sam Sapoznick, the arbitrator who signed the (authentic) order freezing 27 addresses that had been compromised by bad actors, made a different argument: that Larimer’s involvement in such discussions was inappropriate, whatever he was proposing.

“You may be making overtures in a direction which could sabotage the entire project by undermining or completely dissolving the so-far reasonably-well-respected thesis that the main-net is independent of B1’s [Block.one’s] control and influence,” he wrote.

That independence has been a defining feature of EOS. Block.one designed the network, but did not launch it, turning the code over to the community instead. That decision meant the launch process, completed just a couple of weeks ago, was chaotic at times.

Scales image via Shutterstock

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.