Steemit Inc and Dirty Money: The History of the Ninja-Mined Steem Vest
Four Years Ago, Steemit Inc. Acquired 80% of All STEEM
During all of my years on Steemit, I've known about about the mining practices of the early adopters. They mined themselves into whales and created "circles of friends" to upvote each other's posts, creating massive stakes. The most massive is @steemit, which at one point aquired 80% of all STEEM.
This was fine, because this mined STEEM fund was going to "decentralize" and 40% "given away" to attract users.
Gradually Divested
The community tolerated this massive collection of STEEM (vested) because of the promise that it would be "gradually divested" for promotion and development.
But the STEEM wasn't being used that way. It sat there unused.
The Loophole: "Plan"
Notice in the two above statements to the Steem community that the word "plan" is used. When someone says they have funds in hand and they "plan" to do such-and-such with it, who's fault is it if someone believes the plan?
Sometimes people "plan" good things when the money comes in, but plans can change.
So What Happened?
The plan changed after the announcment of SMT.... TWO YEARS AGO!
Steemit Buzzed Because of SMT
A few weeks after the SMT announcement, STEEM was propelled towards the moon. I can't say exactly what caused it, or if it was the SMT announcement, but the timing is fascinating.
Here's where I begin theorizing: Steemit, Inc got drunk on money. Suddenly, their millions of STEEM that was supposed to be "decentralized" and "given away to attract users" was too valuable to spend in that manner.
My theory is that they believed STEEM would be over $100 some day and began spending "as if".
Most of us know the story from here.
Steemit Inc, eventually ran out of money and had to restructure. Things improved greatly, but without any input or leadership from Ned. Communication improved and we began to see development moving forward. But still, SMT's were on the horizon. Even now, they're STILL on the horizon.
Meanwhile, Steemit Inc, was flooding the market with sell orders, 800K STEEM per month.
https://steemitwallet.com/@gsr-io/transfers
Imagine the price of STEEM if it wasn't depressed with 800K STEEM being dumped onto the exchanges every month!
The Final Sale
Ned sold off his ownership of Steemit, Inc along with all the STEEM in the @steemit account. That was about 31,000,000 STEEM (vested and liquid) or currently about $5.6 Million USD
The witnesses executed a soft-fork that prevented the account @steemit to transfer funds, then came the hostile removal of the witnesses, just long enough for a hard-fork reversing it and 2,000,000 of the liquid STEEM (Currently $375K USD) from @steemit was put onto the exchanges and the balance staked.
That 2 Million Steem Was Promised To Be Used, Not Sold
After Ned sold it to Justin, it became his rightful property to do with as he saw fit. The issue was Ned's misappropriation of these funds for years. Nobody really cared as long as Ned didn't try to control the witnesses, so he vowed to not vote witnesses or content.
Ned's Side to the Story
Ned is saying yes, that Steemit Inc, took the risk of mining STEEM tokens before they had value, but even if STEEM were less than $0.10, we're still talking multitudes of $100K for every Million Steem.
https://twitter.com/realNedScott/status/1235317883321884673
https://twitter.com/realNedScott/status/1235318442632400898
No Quid Pro Quo... Only "Plans"
Ned claims no promises, no agreements, no "social contracts". He believes he's keeping his word by SELLING steemit inc to Justin Sun and the Tron Network.
His intentions may have been good, but the betrayal is very very bad. He would say it's not a betrayal, just a change in plans. However leading an entire community one way, then doing nothing, then selling.... many feel betrayed. Including Justin who didn't know the history of this liquid and staked STEEM and the community's opinion of it. Justin didn't know it was considered dirty money.
Congrats @Ned, I wish you well. Drive off in that Lambo, we'll keep posting for 2 or 3 earned steem.
Bless the Most High!
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Nice summary on how our state of affairs came to be.
Posted via Steemleo
The ninja-mined stake is sort of like a back door that Ned promised to never use... instead he sold it for a lot of money. Backdoors are useful for those who want to plunder.
Do you bro, bro? Of course, bro.
You present a very one sided argument.
You did not show any promise that Ned made. You even acknowledge that it was stated as a plan not a promise and plans change as circumstances change.
I have also seen mentioned that other parties were also involved in the ninja mine. I am lead to understand that the Stake mined is being and has been used for voting witnesses which has created a centralized authority. Why do make no mention of this? It has clearly be detrimental to the growth of Steem and Steemit and its users.
I get that it is fashionable right now to shit on Ned and blame him for everything but the reality is he had another Ninja mined stake running interference and dishing out abuse every step of the way.
Thank you for your comment.
If Ned had been transparent and stated his intentions (i.e. changed plans) and made his case, I think the community would have grumbled but ultimately gone along with it. But he offered no transparency or communication, just a powerdown and 800K Steem dumped on the market each month. Not even a "I'm sorry Steemit Inc never delivered SMT... ever."
Thank you for the didactic explanation of the story.
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Glad people are reading it! I like that word "didactic".
It is indeed true.
Thank you.
Son of a wall street banker....
Mmmm....
Educated in one of the most expensive (and progressive) colleges in the US...
Mmmm....
Employed in a company who does property business deals with Trump's son....(and other, much more dubious setups, imo).
Mmmm....
Due diligence is a responsibility for all adults.
Know who you are getting into bed with....
.....It's like feeling betrayed by a shark who decides to bite you, after swimming along side you for a while.
The feeling of betrayal can often be a symptom of internal anger at ones self for being gullible, which is then externalized.
Trust is best earned, (through actions not words in my experience), and is folly to be just given away unconditionally.
(That's a manipulators wet dream come true).
On the upside, I'm working on Steem Wars part 2 - The witnesses strike back!
Steem Wars part 2 - The witnesses strike back! Sounds Awesome!
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Excellent back story using just the facts without letting emotions color the narrative.
Posted via neoxian.city | The City of Neoxian