TRON Will Seize $5 Million Steem From Dissident Tokenholders

Mike Dalton

May. 19, 2020

Steemit is planning to seize over 23.6 million STEEM from dissident users in a hard fork this Wednesday.

Steemit and the STEEM token are under strong bearish pressure.

Key Takeaways

Steem witnesses will seize the assets and accounts of several users who disagree with TRON's buyout of the blockchain.
The decision is part of a long-running dispute between TRON CEO Justin Sun and Hive supporters.
Despite the publicity, most user accounts will not be affected.

Steem, a popular blockchain and social blogging platform, will undergo a hard fork on Wednesday to shut down accounts that object to TRON’s leadership, seizing about $5 million in STEEM in the process.

Steemit Will Seize $5 Million from Dissident Tokenholders

This hard fork will arguably censor several blockchain accounts that are sympathetic to Hive—a blockchain that many users moved to after TRON‘s CEO, Justin Sun, bought-out Steem’s development company Steemit Inc in February.

Steemit, however, argues that Hive is a hostile fork and that many of its users are causing trouble. It claims that many users are sending spam transactions, posting recycled content to disrupt the rewards system, and attacking and doxxing users.

To stop that “malicious” activity, Steem witnesses controlled by TRON plan to “seize some user accounts that participated in criminal activities by actively contributing to the threat against the Steem blockchain.”

The project’s GitHub code suggests that 64 accounts will be affected, while the network data site Steemd estimates that the hardfork will seize 23.6 million STEEM ($5 million) from those users.

An Ongoing Conflict between Justin Sun and Steem Leaders

Justin Sun’s decision to seize tokens from Hive supporters is part of a long-running series of retaliations beginning in February.

Notably, Steemit claims that the Hive blockchain took $16.6 million worth of HIVE tokens away from Steem supporters and deposited those funds into its own DAO account. Hive’s blockchain ledger shows that those transactions did indeed occur.

Hive defenders frame this differently, arguing that those users were not entitled to the tokens, which were given away for free during an airdrop. “Not giving free tokens is not the same as stealing,” a former Steem witness explained on Twitter.

Though the amount of control both parties exert is concerning, it does not appear that these decisions will affect most users. Together, the two blockchains have roughly 30,000 users, and the vast majority will not be affected by the changes.

Nevertheless, the influence TRON and Justin Sun can exert over the supposedly decentralized Steem blockchain is cause for worry among tokenholders.

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