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May 20, 2023

EOS Network should take action against Block.one

Participants in the EOS Network will recall that Block.one (“B1”) promised significant investment in

the EOS Network during the initial coin offering (“ICO”) of the ERC-20 token and after. In January

2018, at the height of the ICO, B1 promised it would invest $1 billion from the ICO proceeds to

developers and entrepreneurs to promote and develop EOSIO. It was broadly understood at the

time that B1 was making these commitments that these investments would be made in the EOS

Network (being the network that Investors who purchased the ERC-20 token from B1 received

tokens in subsequent to the ICO), and yet B1 has provided minimal real support to EOS Network

efforts to develop the network. B1’s promises during the ICO and after have not been fulfilled.

As time has passed, it has become apparent that B1 does not have and has never had any intention

of investing the $1 billion promised in EOS Network. EOS token holders relied on B1 promises when

they purchased the initial ERC-20 tokens, and later when they purchased EOS Tokens for use on

the EOS Network.

As a result of B1’s broken promises, the EOS Network is under-capitalized and the development of

the EOS Network has been significantly stunted. The EOS Network should take action to hold B1 to

its promises. After extensive review, here are two possible ways to do that:

1. EOS token holders, especially block producers, should consider taking legal proceedings

against B1 for breaking its promise to invest in the EOS ecosystem. An action against B1 by

EOS token holders for its misrepresentations seems warranted. EOS token holders

purchased their tokens, until September 1, 2021, relying on B1 representations of ongoing

investment in the EOS ecosystem. That investment, if it had occurred, would have

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greatly improved the functionality of EOS Network and the value of EOS tokens. Instead, B1

has kept the $1 billion of promised investment for itself. Given the lack of action by B1 to

fulfill its promises, we can only conclude that B1 never intended to make the investments it

promised. If enough token holders are interested in making a legal claim, a class action

lawsuit is a possibility. The EOS Network Foundation is prepared to assist in bringing EOS

token holders together for the purpose of advancing a claim against B1.

2. EOS Network block producers should consider a hard fork to exclude B1 owned tokens and

exclude Bullish from participation in EOS token trading. This would have the effect of

decreasing the outstanding volume of EOS tokens. More importantly, it would have the

effect of fully separating the EOS Network from its association with B1, driving further

confidence in the EOS Network.

Action should be taken as soon as possible in order to build on the success the EOS Network is

already having and position EOS Network to continue its support for developers in the EOS

Network space. Interested parties can reach out at legal@eosnetwork.com

EOS Network remains the most compelling utility token network in the crypto space. Taking

steps to hold B1 to its promises of investment in EOS Network will only improve EOS Network’s

position and the long term value that EOS Network can bring to its participants.

Yves La Rose

Founder and CEO, EOS Network Foundation