Hive (HIVE)
$0.137346 (-4.81 %) View coin |
Steem (STEEM)
$0.160860 (-1.35 %) View coin
25 May 2020

Bittrex, Binance opt to support controversial Steem hard fork

Crypto exchanges Bittrex and Binance have (reluctantly) agreed to support Steem hard fork 0.23, which seized the assets from 64 former witnesses (totaling 23.6 million STEEM). These witnesses reportedly led the creation of Steem’s contentious clone, Hive, back in March and blocked current Steem supporters from receiving newly created HIVE tokens. Some have speculated that hard fork 0.23 is a retaliation against the Hive faction.

In an ironic twist, Steem’s upgrade last week sent the seized funds to a specific account (@community321) whose private keys were unknowingly kept by an anti-0.23 fork community member. This owner shipped almost all of the 23.6 million STEM to Bittrex with the message, “these are stolen funds…please return them to their original owners prior to the fork.” In a blog post, Bittrex founder Richie Lai responded that while he doesn’t agree with the outcome, the exchange must adhere to the consensus rules. The funds remain in Bittrex’s position, but it reportedly plans to return them to the @community321 account.

The exchange could be holding the funds until current Steem witnesses regain control of the @community321 account. On Friday, witnesses launched soft fork 0.23.1 to limit the account’s transfer functions and remove community control over it.

Why it matters: - The whole situation is a mess. It helps put in perspective that delegated Proof of Stake (dPoS) chains are very susceptible to hostile takeovers. Even Binance CEO CZ stated that zeroing accounts on a network means “it is overly centralized” (the irony is Binance Chain operates via a similar consensus mechanism at the moment). Warring sects of validators could be the fate of most dPoS chains down the road. - The intra-network fight seems to be heading off-chain at the moment. Some of the former Steem validators affected by the latest hard fork are tentatively preparing to bring a class action lawsuit against exchanges that support it. Andreas Antonopoulos alluded to this outcome in a recent tweet, saying that the fork could result in a class action lawsuit with participating exchanges named defendants. On the opposing side, Decrypt recently reported that Tron creator Justin Sun is working with law enforcement over the HIVE tokens he claims were “stolen” from him.

No other news.
No upcoming event.

3 coins to keep an eye on 👀

Subscribe to receive a weekly selection of 3 coins to watch closely, based on upcoming events and technical analysis.