Steemit Communications Head Steps Down as Binance Reverses Votes in Steemit Takeover Mar 3, 2020 Mar 3, 2020 Kelly Cromley http://1AZFjzw2#Nwf63pYaMWq#xIY
Market NewsMarch 3, 2020 by Kelly Cromley

Steemit Communications Head Steps Down as Binance Reverses Votes in Steemit Takeover

Binance CEO Changpeng Zhao disclosed that the cryptocurrency exchange had withdrawn its votes that resulted in an abrupt change of grip on steem blockchain.

Cryptocurrency exchanges such as Huobi, Binance and Poloniex face the wrath of crypto enthusiasts for supposedly building up clients support in favor of a hostile acquisition of Steemit, a famous crypto blogging platform.

Steemit platform is powered by Steem blockchain, which utilizes a proof-of-stake covenant, where a handful of ‘witnesses’ are voted to safeguard the network. Votes are earmarked as per the number of tokens that an individual possesses in their wallet.

Steem’s witnesses were evicted on behalf of a single user, @dev365, an account supposedly held by Justin Sun, Tron’s founder.

Zhao clarified that he was notified about an upcoming “upgrade/hardfork” which he had given support for, summing “Projects do this all the time, and we are usually just in a supportive position.”

Justin Sun responded to the uproar on social media by informing that he will withdraw his votes as well. Sun tweeted to deny “misleading comments” about the seizure of power, indicating that “all parties votes will be withdrawn.”

The obvious coup was organized by Huobi, Binance and Poloniex, who placed on stake gargantuan quantity of STEEM tokens to vote in favor of withdrawing the earlier witnesses.

The top five voters received a total of 208,414 votes, with each of them representing 4 to 5 voters. The next three biggest voters received between 88,000 and 90,000 votes, nevertheless, they account for 9,700 to 14,000 voters.

The endeavored takeover seems to have been backed using the holdings of clients’ of exchanges, with several unreliable news of postponed withdrawal periods for huge Tron (TRX) withdrawals on Binance passed via crypto related tweets.

Vitalik Buterin, co-founder of Ethereum, responded through a tweet as follows:

“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)”

Andrew Levine, Steemit’s head of communications, has given up the venture due to dissent. On 14th of last month, a news release indicated that Steemit would move from the Steem blockchain to the Tron network, after the company was bought by Justin Sun, founder of Tron.

By taking over the firm, Sun gained control over a huge pile of tokens representing roughly 20% of Steem liquidity. For a while, the tokens had been a source of dispute within the Steemit group, frequently classifying the supply as a “ninja mine.”

The takeover incited steem’s ex-witnesses to carry out a revocable soft fork to intermittently block Sun’s tokens to avoid using it for voting. Yesterday, the newly formed Steemit core team stated that they would muster the tokens for voting to “resume the order of the community,” explaining the fork as “maliciously structured” and likely unlawful conduct “led by a small group of people.”

AuthorKelly Cromley

Kelly is our in house crytpto researcher, delving into the stories which matter from blockchains being used in the real world to new ico coming out.