Cardano’s Charles Hoskison, has called the EOS’s $4bn crowd-funding egregious and has predicted that the project will likely face significant backlash from the US Securities and Exchange Commission (SEC). Speaking at the Cardano-centric PlutusFest, founder of Cardano (ADA) and IOHK chief, Charles Hoskison explained that he believed that the US regulators would come after the EOS project. He highlighted that one of the major reasons for this backlash would be the project’s crowdfunding.

“[…]I can’t imagine how they’re (Block.One) not going to have some sort of issue with the SEC […]” He said.

He brought the $4 billion crowdfunding carried out into focus terming it as ‘egregious’. He explained that the way the EOS’s Initial Coin Offering was carried out had a lot of fundamental faults and he emphasized that the SEC “needed” to take some action.

Roll-Out of EOS Project not as Expected

Admittedly, the EOS’s Initial Coin Offering was a year-long affair which rounded up to $4 billion, making it one of biggest ICOs in the crypto scene. However, the roll-out of the project has not exactly been a smooth transition. The EOS system was seen to have developed some teething problems at the beginning with a botched mainnet launch leading the way and spiraling into full blown issues such as a five-month hacking episode and decentralization disputes. Clearly, Charles Hoskison was not the only one thinking about the crowdfunding as the recently reported BitMEX research cited the $4 billion price tag and 21 block producers as a limitation. Launched in a community concerned about decentralization, the EOS blockchain has been under constant scrutiny. Also, there had been a low adoption of the distributed applications (DApps) launched on the network- an issue perhaps worried about the most especially considering the huge amount invested in the project. The fact that the US environs were excluded from the EOS ICO sale was also brought into focus. The US ICO landscape reportedly makes up the second largest percentage of the ICO market. Hence, the sheer size of the amount made with the US market exempted and the fact that EOS could be bought in secondary markets without KYC might be a reason for the US SEC scrutiny. Especially with regulators constantly expressing their distrust about cryptocurrencies and dubbing them as tools for terrorism and money laundering, Block.One and EOS ecosystem appears to be lacking in various proportions.