The uniqueness of decentralized networks is that no single individual or entity should have access or control over it. Justin Sun, the CEO of Tron in a recent move commandeered the Steemit blockchain after some Steemit community members attempted to safeguard the integrity of the network by deploying a soft fork.
It all started when the Steemit founder, Daniel Larimer announced that Tron had acquired the blockchain-based content creation platform. Subsequently, in a bid to make sure that the platform doesn’t get centralized by the new owner, Tron, some developer community members tweaked the Steemit code in a soft fork named 22.2 taking the Tron team unawares.
The soft fork was executed in conjunction with Steemit witnesses, developers and stakeholder. In a release, they stated the need for the network to remain decentralized despite Tron taking over the company:
“Communication on the company acquisition is scattered and conflicting at this time, and we believe it is important to be proactive, rather than risk a possible security threat to the Steem blockchain. Since there are many new developments in the ecosystem, this is an ideal time to take a look at one of our long term impediments to decentralization with the involvement of the entire community, old and new. With this announcement, we’re providing a detailed look at this soft fork update, why it was implemented, and how you can get involved as the voices of the Steem community.”
The move certainly wasn’t what Tron was expecting. According to Justin Tron, the Tron CEO:
“With so much happening in Steem right out the gates for me and everyone at Tron and Steemit Inc, such as the launch of Communities and a soft fork 22.2 we weren’t expecting, I feel it is important to show you guys I am here and ready to begin building with you.”
Your stake in Steem on centralized exchanges was just used to take over the Steem Blockchain https://t.co/AFn0LvEkUC— Luke Stokes (@lukestokes) March 2, 2020
Not to be outdone, Tron moved to exchanges such as Poloniex, Binance and Huobi and bought up some 84 million Steem tokens in a strategic move that gives the company majority vote among Block Producers (BP) of the Steemit network. This means that the top BPs would be chosen by Justin Sun of Tron. So the attempt to keep him off control of the Steemit blockchain through the soft fork has been defeated.
The move by Tron may seem logical since the company is protecting its investment. Nevertheless, there have been questions asked about the need to safeguard the integrity of decentralized platforms trough more decentralization rather than centralization as is now the case with Steemit.
In reality, a platform like Steemit will not move in the direction of one man, Sun instead of that of the community. This means that Steemit will end up just another centralized company like Ripple.
The lesson that the community should learn from this is that tokens and coins should be stored in a decentralized manner in personally controlled storages and not in centralized exchanges. As long as holders keep their digital assets in exchanges, whales such as Sun would be successful in taking over networks.
#STEEM has successfully defeated the hackers & all funds are super #SAFU. @SteemNetwork and @steemit community is now stronger than ever since we united & solved the difficulties! Full details below👇— Justin Sun (@justinsuntron) March 3, 2020
There are questions on the role played by exchanges in mobilizing deposits of their customers in the takeover which practically displaced Seemit witnesses. This has also exposed the flaws of the delegated proof of stake (DPoS) employed by some blockchain networks.
According to Ethereum co-founder, Vitalik Buterin:
“Apparently Steem DPOS got taken over by big exchanges voting with depositors’ funds. Can anyone confirm and/or provide details? Seems like the first big instance of a ‘de facto bribe attack’ on coin voting (the bribe being exch[ange]s giving hodlers convenience and taking their votes)”