A spreadsheet has been leaked, allegedly authored by Shi Feifei, a Huobi employee. Titled “Huobi Pool Node Account Data 20180911,” the document details mutual voting and sharing of proceeds from producing blocks in EOS.
The document shows Huobi votes f0r 20 Block Producers (miners) in EOS with 16 of them voting for Huobi in return.
An analysis of the document further shows Huobi was previously supporting seven standby BPs which have “no public nodes, no website, no ownership information, no node interaction, etc,” according to a rough translation.
They’ve however turned to supporting “normal” BPs in an arrangement with some of them whereby Huobi receives some of the proceeds.
The document alleges Huobi votes for eosiosg11111 in return for 170 EOS, for cochainworld in return for 150 EOS and eospaceioeos for 50% of the returns.
These arrangements allegedly earn Huobi 1,116 EOS per day, currently worth about $6,000 a day. In addition, Huboi is a block producer itself which earns them quite a bit more.
It appears they are voting with the EOS tokens individuals deposit in their exchange. Bitfinex is another EOS block producing miner, and they said long ago they’ll be voting with their customer’s EOS.
Ownership in EOS is highly concentrated, with just 10 addresses holding some 50% of all tokens. Exchanges tend to dominate for obvious reasons, but in other public blockchain they have no say in protocol rules and take no direct part in validation.
In EOS, however, it appears exchanges effectively control the network with this very centralized blockchain having just 21 validators. Some of which are seemingly controlled by just one entity with Huobi allegedly able to act as a king maker.
That’s because EOS is fundamentally flawed and its flaw has been proven. The design is similar to Dan Larimer’s previous project, BitShares, which he himself said had failed in the voting aspect.
Just as now so then, the Yunbi Exchange was able to milk Bitshares with the actors changing while the mess remains the same.
EOS raised $4 billion in a year long ICO for this clone of Bitshares, with the project now collapsing into a centralized colluding cartel which requires a great deal of trust by holders and dapps that their funds won’t be seized or their dapp won’t be frozen.