TRON strikes back - And now they own the Steem blockchain
What a weird day...
While i started to be a bit more positive, i have to say i am not surprised with what just happened today.
Soft-fork 22.2 was a success, but...
We forgot to account the STEEM on the exchanges.
On the first time i talked about this, i even acknowledge that there was a close tie between Tron and some major exchanges.
I honestly don't think this move to take back control of Steemit Inc. stake would be easy to predict, specially since (in theory), exchanges should be neutral on their involvement on how they affect the markets.
Steem decentralization dreams are over
Everyone knew that Steemit Inc. stake being used to take control of the chain was a ghost that hovered over the community since the beginning, but it was a choice made by the community/witnessess to belive that Steemit Inc. word would be held true.
It was a social contract, that was seen as beneficial for the development of the blockchain.
That's why removing Steem Inc. from the equations was always talked about, but never implemented.
Altough we all agree that Steemit Inc. and @ned was never a successful company regarding the development of Steem blockchain, at least there was a mutual trust between them and the community.
But a decentralized system should stay decentralized, no matter who owns what.
Steem was never a decentralized system. Today was just a proof of that fact.
Justin Sun wasn't bound to the same social contract
He was the new owner, looking to implement new rules.
There was no legal obligation about what Steemit Inc. could or couldn't do with it's stake.
Doesn't matter if you agreed or not with Soft-fork 22.2
What happened today have way bigger implications than "freezing a stake for some time until we figure out what will happen"
First, like i said, any possibility of decentralizing Steem blockchain is now over.
Even after the exchanges remove their votes, Steemit Inc. now have their stake back + 200k STEEM recieved daily by controling the top 20 witness.
So, no matter how hard the community want to put other people as main block producers, it will only happen if Justin Sun approve.
And this have an impact not only on Steem, but every other PoS or DPoS blockchain protocol.
This is the first official takeover of a Proof-of-Stake blockchain.
What the exchanges did is sort-of a illegal action
I say sort-of exactly because there is no regulations in place yet to define accountability.
But if you go to the traditional markets, it would be like if you deposited your money on a broker to operate on the financial markets, and the broker used your funds to do other financial operations.
The legality of that action might vary depending on the country the broker is operating, but in most countries, only banks (that follow strict regulations and must have guarantees in place) might make that kind of use of their clients money.
And an exchange is not a bank.
It doesn't matter if there wasn't a risk that clients funds could lost. The exchanges (Huobi, Binance and Poloniex) used their client funds to an end withouth their clients consent.
And now, they don't have enough liquid STEEM (until the next blockchain version allowing to power down in 1-3 days to bail them out) to pay their clients when they want to withdraw.
Steem will move on, but not as we knew
Since the decentralized blockchain are now in the past, two things will happen for sure:
- Steemit Inc. + today Steem blockchain will the governed by Tron, and everything will happen the way they want, no matter what the community opinion is
- Some witnessess will fork a 'classic steem/SteemCash', probably isolating Steemit Inc. + exchanges stakes and try to rebuild, without any infrastructure or support from the exchanges.
It's impossible to say what will happen with each of the chains, but one of the main players of this place will have a really hard time to make a decision:
The developers
While a lot of people is saying that Tron don't "own the community", at the end of the day, it doesn't matter to him what the community will do.
He owns the brand, and he owns the blockchain. And he have enough money to create enough marketing to onboard new users.
But the developers are the ones with the tough decision.
Development takes time and need money, and while the ideal of a fully decentralized 'new steem' is a great thing to think about, everyone got bills to pay.
This might have been a wrong move by Tron foundation
While some might see this as a legitimate way to "take back his property" what Justin Sun did might come back to bite him in the ass, and end up diggin a deeper grave for Steem.
One of his main marketing lines for Tron is that he wants to make decentralization accessible.
But how can he do that, if his products are centralized/can be controled by Tron?
There is a disconnect between what is said and what is done.
While this kind of marketing might work for some time if enought money is being pushed into it, eventually, he will lose credibility.
Will this affect Tron growth? No one knows, but what i know is that long term profitability is only reached when a company have credibility.
Old witnessess are still stubborn
Please... Stop. Accept the loss, and move on. Join Tron Steem or Join the Fork (Or none of them)
Stop being delusional that there is a way to 'take the blockchain back'. There isn't. Tron control the witness now.
So, stop whining and talking and choose a side.
My personal feelings and opinions
I am a bit sad about what happened, even if it wasn't that surprising. I don't see a way out of this but stick with Tron or Join the Fork.
I am sad because even with all the flaws, Steem is a unique place, with unique and interesting people (even if i don't agree with a lot of them), and it sucks to see this part of it's history ending like this.
It's sad to see that this blockchain will never achieve what i thought it could be: a platform where people where rewarded by their time and thoughts, not controled by only one person/company/institution.
Probably it will now become another "dApp" on another blockchain...
In any case: Steem on...
Realistic analysis of the situation. I fully agree that what the exchanges did are less than legal and a breach of trust. It will be interesting to see what will happen when STEEM withdrawals are done en mass on those exchanges. Since they need time to power down, it will either force a very fast code change, or the exchanges might be forced to buy STEEM from somewhere else.
I think a fork seems inevitable. Witnesses might need to pick a side but for normal Steemians like us, we can still exist on both forks.
Appreciated @phgnomo.
You can be sure that most steemians share that feeling of sadness. But no one has died here, so we must get up and continue.
Sun, has proven to be a fierce financial chess player. The moves have been made much earlier. Or is it that the purchase of poloniex months ago was a fortuitous event? Well, no! It's all part of a mega strategy, which none of the previous witnesses could see.
So if Justin was able to make that master move, don't you think he would be able to do it again?
A new play by this financial genius could take a 180 ° turn and surprise everyone again.
For me, this was only a warning of what he is capable of. It was a show of strength.
If the witnesses had been smarter, this would not have happened. The witnesses didn't think about everything, Justin did.
Your friend, Juan.
The decentralized 'dream' died. And that is what makes me sad.
Also, this have implications beyond Steem.
While it was debatable if soft fork 22.2 was right/needed/useful, Justin actions are not.
It's ethically wrong, no matter what your culture is, specially he "promissed" to have a talk with top 50 witness. It's a plain sight betrayal.
Besides that, exchanges using users funds for anything else than be a custodian of these funds is wrong, and illegal in any other financial market.
Exchanges aren't banks. They are not allowed to use client funds to do any kind of leverage.
And if every power move we see in the world were applauded as a 'genius move' then the world would be way shittier than what already is.
What the exchanges did was somewhat detestable.
What do you think about current situation @phgnomo, @juanmolina?
It's becoming more and more interesting.
I think we're witnessing some sort of decentralization for the very first time. Before we hasd situation similar to democratic country , where there is only one party and almost all 20 politicians are representing this one party.
We were centralized - and now we're "centralized less" :)
I wasn't going to post anymore about this subject, but man... it's hard not to...
Not really. What we are witnessing now is just the prove of how fragile the steem decentralization is.
Yes, it happened using unethical means, but it could also happens by legitimate ways, by someone just buying more steem and convincing other people to vote for him.
It's nice what we are seeing, the fight to block the Hard Fork, but honestly, i think it will be useless in the end. Justin will have it his way in the end.
Hi @phgnomo
I already bookmarked your post and will read it later on - once I will have little bit more time. Till then - enjoy solid upvote from tipu
@tipu curate
Upvoted 👌 (Mana: 15/20 - need recharge?)
owwww
This was a powerful move. Could this cause something similar to what happened with ETC or BCH? I mean, split the blockchain Steem and create two blockchains?
I suppose Justin must be very careful with his actions, as this could impact and reaffirm the fear many large investors have about the unstable world of cryptocurrencies.
These are just hunches that come to my mind.
Thank you for sharing
I think that Sun really took a blow that he did not expect, he managed to take out the 20 main witnesses of the game and he was left with all the power of government.
The blockchain steem government has been centralized and I think everything will change as a result of this.