Since the inception of the EOS Mainnet chain, the community has been very critical with regards to its constitution and things turned even worse when, time after time, bad actors started violating it and it has been discovered that some articles are simply unenforceable invalidating the sense of having them at all.
The constitution has been drafted by the community members, but until the last day, there was a dissent regarding its content. Daniel Larimer himself said that he could not agree with certain articles and has deleted the constitution from the EOSIO github repository.
The fork has been performed immediately and EOS Mainnet came into life as well as its constitution. Some articles of the constitution caused a big mediatic outrage and the community voiced its dissent.
Things worsened when the EOS Core Arbitration Forum (ECAF) started to release first account freeze orders.
From there it has been spiralling down of a great amount of unresolved cases and constitution breaking without any repercussions to the violator. As of 14 December 2018, there are 864 cases filed and just two ruled cases.
The constitution with its base layer arbitration in form of the ECAF was born with the premise of protecting the property of the community members, but it failed when gambling dapp hacks started occurring and the property has not been preserved.
Some cases have not even been filled as the code of these dapps was not open source. The article VII of the constitution states that “Each Developer shall offer their smart contracts via a free and open source license, and each smart contract shall be documented with a Ricardian Contract stating the intent of all parties and naming the Arbitration Forum that will resolve disputes arising from that contract.”
The question is not why didn’t the hacked dapps filled the dispute, but rather why these closed source dapps were operating on the EOS Mainnet if the constitution requires an open source license?
It is being argued that EOS does not possesses a policing body and there needs to be always someone to file a cause. If no one challenges a closed source dapp then it effectively continues operating. But there is one member of the community who has filed a cause to the ECAF over a closed source dapp, unfortunately it has not been accepted and the reason for the rejection was not even provided.
When on 11th October a whale account holding 2M EOS worth $12M has been phished and some Block Producers intervened immediately to freeze it as soon as they have seen a suspicious transfer, the community was indignant at the preferential treatment this whale has received.
The law is simply not equal for all.
Month after month, always new scandal hit EOS and now it was time for Huobi exchange accused of votes exchange. The files documenting alleged vote exchange practice spread around the world and, although nothing has been proved and no dispute has been filed, many think that the vote exchange occurred.
Mutual voting is particularly dangerous because it permits cartel creation and exposes the chain at a security risk. Coincidentally, the BPs present on the leaked files were also those present in the top 21. While the alleged vote exchange practice was going on underground, Starteos were more explicit about it. The China based BP wrote an article on Medium where they state that the company offers a revenue in exchange for votes. In order to get the revenue, the voter needs to select Starteos as a proxy and chose a preferred revenue model, which can be either stable income or random revenue. What’s more, Starteos created another BP called game.eos and are effectively running two BPs if not more. Running more BPs means that with enough votes one entity can occupy more higher ranks driving to centralisation. It was since early days of EOS that the sock puppets plagued the network but despite all the evidence, nothing could be done.
Chintai is a community owned dapp developed by BPs under the guide of EOS42. As far as beneficial this dapp can be, we have seen that in a short period of time its proxy accumulated 16M EOS that are being used to vote for different BPs. This could be deemed a vote buing technique and may be in breach of different articles of the constitution.
But Chintai’s Ricardian clause state: “You agree that Chintai has the sole right to vote any EOS Tokens we hold on your behalf in any way we choose. You hereby waive any and all claims against Chintai for such voting.”
The dapp sponsors and some other BPs have been lately added to that list. Having the most EOS of all other proxies, Chintai created a big shake up in the BP rankings.
This means that a dapp clause is being superior to the underlying EOS constitution and in breach with it.
Chintai is also a closed source dapp similarly as most of the dapps out there. “It is impossible to audit its code and even assess what forms of centralisations it might hide” says Luka Percic from ChainRift EOS.
The above scenario has been going on since the network launch and despite mediatic and community outrage nothing has been done to change it. The outrage is big because EOS Mainnet is a chain with the constitution which rules should be respected but are disregarded instead.
This is even more startling when we look at BPs – the people who should be protectors of the network but are those who abuse it most. The unenforceability of the constitution created a kind of Wild West between BPs who invent always new ways of exploiting its loose rules.
BPs were calling for a long time to respect the ECAF and its rulings, but it became obvious that an unelected body could not last long and could not have the credibility it should be having. One could sense that the general community sentiment was that ECAF should stop its activity and if there was no ECAF, token holders would not mind. Is it because of the lack of support for this disputes resolution forum that the BPs started feeling free to act in contrast with the rules and for their own benefit?
All the power is in BPs hands now but Huobi, Starteos and Chintai are those who effectively pull the strings and it remains to see if they have the good of the network and the community at heart or if financial gains and power are what counts most.
This article has been written with the purpose of outlining the problems with having a constitution with unenforceable rules and an unelected body of people with critical impact on the network. The constitution has failed to fulfil its expectations because it has been conceived in a broken way from the very beginning. Even Daniel Larimer said before the mainnet launch that he could not sign the constitution and he followed with his v2 proposal.
The constitution failed to get community’s support. “The code can help implement the governance process, but ultimately it is the people who must cooperate with one another to effect change” wrote Daniel in his post “Why every blockchain needs a constitution“.
The community lacked this cooperation and, most importantly, the moral compass went missing.
It is to be seen if BPs will agree on making a change to this interim constitution via 15/21 approval as outlined in the whitepaper and adopt a code of conduct that will have certain ethical rules to follow, but one thing is sure: BPs inaction, hiding from taking a stance on important matters and violation of first principles should not have place in this community.