Ok so a lot has been said about the the matter on hand so I am going to just say what is going on in my mind.
The core issue is that nothing has changed...before this happened one person had about 35% of the staked steem and after that we still have one person with the same amount of potential control of the consensus witness positions.
What has changed is that we do not know what Justin Sun wants to do with his new toy.
Before. there was a tacit agreement not to use steemit's stake to determine who occupies the top 20 witness positions and also not to use the same stake to distribute rewards (at least the majority of it).
In the AMA held yesterday on DLive Justin indicated that we will leave things as is...for now.
Before, we knew that steemit would gradually sell it's stake and therefore their potential influence on consensus would diminish over time.
Nothing has changed and everything has changed.
Is this an existential threat to the steem blockchain? Yes and no.
It's a threat if Justin Sun decides to use Steemit Inc's relationship with exchanges to delist the steem token (the one that runs on the steem blockchain) and substitute it with another one that runs on the Tron blockchain.
If the new steemit decides to vote their own witness nodes to the top positions it is not an existential threat to the steem blockchain. This would just be DPOS working as intended...those that have the most stake can control consensus.
I am not sure that Justin Sun desires to do either one but you never know. After all he is an outsider and it is logical to assume that his priority is to grow Tron and Steemit is just a means to an end.
Personally I think it's doubtful that he would want to go down that road. It would be less contentious to just create a token on Tron that is distributed via steemit.com and runs in parallel with steem clasic.
Proof of Work chains protect themselves with hashpower. You have to spend fiat to purshase "mining" equipment in order to participate in the consensus algorithm. The more hashpower the more expensive it becomes.
POS and DPOS chains protect themselves in a similar manner. You have to buy the token in order to influence consensus. That is, if their is enough on sale to be able to acquire the necessary stake to acomplish a takeover of a chain.
So in theory obtaining a majority stake entails that you need to buy out a good amount of it from the current token holders. IF you use your newly acquired power to do something malicious you run the risk of losing your investment if everyone else starts to jump ship.
POS and DPOS chains need to have a big enough marketcap to be protected from bad actors.
STEEM is a small cap coin but it is not so small, in order to have enough stake to attempt a take over you need to pretty much remove all of the liquidity from the exchanges.
That would send the token price to the moon. But that did not happen, Ned sold his stake in a private transaction that did not have an influence on the price. So in a way he shafted all of us.
In theory steemit inc does not have enough stake to take over the witness positions. They only have 35% of the staked steem and you need two thirds (plus one) of the top positions to determine consensus but in practice, if they so desire they can (not all of the stake cares to vote which can also be seen on the SPS).
What can we learn from this? A couple of things:
- One is that a DPOS chain needs a big enough marketcap to protect consensus.
- Another is that due to voter apathy you don't need to have majority stake to control it.
- A big enough stakeholder can sell out without affecting the value of a token as exemplified by the private sale of Steemit.
- As a corollary DPOS consensus could be compromised if the stake of the chain in question is not well distributed. (To be clear Steem's consensus is not compromised, far from it...at least not in my opinion).
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