Man, from my eyes there's a lot of upset people in a lot of different directions on the chain right now. Some are mad at Ned, some are mad at Eli, some are mad at Justin, some are mad at Steemit, some are mad at the witnesses, some are just mad and don't even know who to blame. There's a fair amount of distrust and hostility all around the chain. I'd like to take a moment to walk us back to how and where this all started, how we got to where we are today, propose alternatives for how this resolves, and suggest a plan so that it resolves well. This is a decent sized read, but hopefully the ideas in here will provide a pretty decent understanding of how we got here and how we get out of here as one whole group.
These are just my personal thoughts. Despite being involved in many projects around here I'm not trying to speak for any of them. They'll have different needs and different consensus has to be built. It's just me sharing my personal self:
- Ned is a criminal who conned/defrauded the chain and Justin
- Witnesses needed to intervene to stop and help correct the situation via temporary Softfork
- Justin has to make his intentions known
- Witnesses need time to code a way to trustlessly move forward
Steem doesn't have the ability to color code the stake, but for the purpose of example let's try to do that with your imagination! I think it may help people understand where many witnesses and whales are coming from with regard to the Steemit Stake. By color coding the Stake I hope you'll see the challenge has to do with obligations steemit inc has incurred on this particular stake.
Steemit stake - Neon Green
Ninja Mined stake - Black
All other - White
A brief history of Steemit Stake - Neon Green
- Chain announced, mining enabled, little explanation given on how to mine leaving only certain entities and individuals capable (ninja mine). Steemit makes declarations via bitcointalk forums that Steemit Inc stake will be used to develop the chain, onboard users, and be non-voting
- Chain started, bug reported (misfire of steemit miners?), chain restarted from scratch after 1 day, reputation rekted
- Mining commenced for months. Steemit acquires 80-90% through heavy mining. Other ninja miners with dev abilities figure out a way to get a bunch of Steem. Minor amount starts spreading to content posters and witnesses. Steemit provides more commentary in posts, hardfork notes, interviews, and recordings that Steemit Inc Stake will be used to develop the chain, onboard users, and be non-voting.
- Steemit mining stopped. Other miners continue for a bit. Inflation set to maximum warp. Percentage of stake stays roughly the same, price plummets, inflation stopped. Steemit owns 80%+ and now it's ~200 million Steem (not positive on this number). Steemit continues to tell the community in things like the 2017 product roadmap that Steemit will use the stake to onboard users, develop the chain, and remain non-voting.
- Steemit sells off Steem over time periodically and in spurts. Some to pay for hosting steemit.com, some to pay for salaries, some is hoarded, some is put towards Ned's private project Destiny, and some is allegedly sold to give Ned a payday (alleged $30M USD).
- On November 14th 2020 the remaining stake is at ~75 million steem tokens on chain in Steemit accounts and potentially more sitting in exchanges (I've heard as high as 30 million alleged). The money from the sale of Steemit to Tron is pocketed by Ned (this is where I argue the most recent fraud occurred).
For this example please consider any Steem tokens which were promised over and over to be used for the development of Steem or onboarding new users to be Neon Green. That color can be washed out by doing something like selling steem to pay an employee salary or paying amazon for a server bill. It should remain Neon Green if used or taken by Ned privately or sitting in Steem accounts or exchange accounts owned and operated by Steemit INC.
What about the other miners? - black color coded
Steemit wasn't the only one mining. HOWEVER; Steemit was the only one promising over 4 years to help the chain with the stake. So, yes, the other miners ninja mined, but I'm going to color their stake black (like a ninja). It's different than the Steemit stake. Blocktrades, bernie, freedom, xeroc, and others mined their stake, but they didn't write and say over and over that they were lead developers on the project, name it after themselves, or promise to do anything with it to the community. Yes they had an advantage, but they weren't making contractual obligations the entire time they mined and stayed here.
All other stake - white
There's lots of ways one can get stake. Buying/Selling, writing, labor, selling goods and services, witnessing, etc. I'm whitelisting all of that stake and color coding it white.
How do the colors help us
I've heard a lot of different notions around the chain regarding why witnesses are doing the softfork, how they might do it to others, and a lot of what I consider nonsense. I won't speak for other witnesses but to me the Steemit stake is NOT free and clear of obligations. Steemit has steadily promised for four years to use the Neon Green Steemit stake to benefit the community. It was not Ned's stash to bro-down with or to use for private projects. Telling a community he will use money to grow the community and instead uses it for personal benefit is civil and criminal fraud. So, I see the softfork and ongoing tensions to be centered around two key factors-
- The Neon Green stake has obligations tied to it
- On Feb 14 (potentially multiple other times as well) Steemit/Ned acted dishonorably and and I think Ned acted criminally by selling tokens promised for community development for private gain.
Stop and correct
For everyone's sake the best thing to do is call a "timeout." With my switch to 22.2 I'm implying:
- Ned likely defrauded Justin and committed securities fraud in his sale of Steemit Inc,
- Ned defrauded the community and committed a separate criminal act by selling stake with public obligations for private personal gain.
- Justin is held by the same obligations of the Steemit stake and likely doesn't know it. Isolating this stake while information can be shared can protect him from liability and ensure he doesn't cause harm.
- Justin, Steemit, and the community need time to figure out what's next without powerdown countdowns, added pressure, escalations, hardforks that threaten exchange pairings, etc.
The point is not abusing investors
This isn't about just any whale buying any stake from exchanges. This (to me) isn't about Justin specifically. It's about this Neon Green stake that has to be treated differently than all the other types of stake because of the verbal and written commitments tied to it over 4 years of beating the same drum.
The witnesses aren't going to freeze your grandmas stake if they come here. This isn't anti-investor. To me, it's not a power grab to keep witnesses exactly the same (hint they change frequently now). It's a timeout so everyone has time to process Ned's (criminal) actions and figure out how to resolve the next steps without this thing escalating further.
To summarize: First we stop. Then we correct
How to unravel
Justin and Tron completed the sale on the 14th of February. They announced a meeting on March 6th. That's 21 days. That's enough time to figure out what happened, how it happened, and why there's cause for concern.
There's also enough time for Justin and team to have a pretty broad plan regarding what they're going to do.
I think the next step is Justin et al state their intention in writing prior to March 6th and then talk through them publicly on March 6th (but not on Dlive). Witnesses then need time to codify a trustless execution of plan(s) from there.
Ultimately my goal is to keep everyone together and progressing as one chain, but that may not be possible. Some of you will likely take the following section as threats to Justin of "Give me this!" Kind of like "Give us the money Tronowski or we'll cut off your whaleballs." But I'd encourage you to hear more like this "The condition of my residence on this chain requires your voluntary consent to be bound by the obligations that Steemit has incurred over 4 years. If you refuse to accept the liability of the stake you purchased, despite it being from a conman, I'll withdraw my consent to be here. I'll fork off to a different chain and carry on without this 75M Steem burden."
Let's start with the two extreme ends.
- Justin tells us all to pound sand, forces a swap, and plans to vote in his own witnesses. I can't speak for everyone else, but I'd be migrating to a fork of Steem. I imagine that 95% of Steemians would leave effectively nuking this place. I imagine Tron holders look at that action unfavorably.
- Justin recognizes that Steemit stake is different and carries obligations. He cancels the swap, pledges to run and support steemit, uses his influence to add exchange pair listings, and grows this thing through voluntary cross-pollination with his other projects. He gives money to the foundation to help govern (and sue Ned), gives some to the SPS, pledges to keep much for the progress of Steem, burns a portion, and doesn't ask for a single Steem for himself. I would imagine 100% of users stick around for that.
I consider neither of outcomes all that likely. I bet it's closer to 2, but not precisely 2.
Let's talk about fork scenarios
On the off chance Justin goes for option 1, telling us all to bugger off, here's the various forks I think will take place:
A. NeoSteem Forks
- Steemit stake set to 0. SPS gets a 75M steem boost.
- Steemit stake set to 0. It all went to Null.
B. PseudoSteem Forks
- User account names and keys are preserved but distributions of stake are modified beyond just Steemit accounts.
In the event of a fork I imagine there's multiple forks that simultaneously come out and the community fractures into portions that move in different directions. In the scenario where he tells us all to screw off essentially it'll be a battle of money, counter party, devs, apps, leaders, and influencers to figure out which chain becomes dominant (hint: in the case of forks I'll support A2- steemit stake goes to null).
Some version closer to Justin's option 2
Which scenario plays out I think is really up to Justin at this point and finding a balance of what he can consent to and what chain residents are willing to participate in.
If my understanding is correct of how events played out I'd like to offer this as a roadmap for resolution.
- Justin again states his intention to grow steem. He retracts marketing to the contrary. He removes all mention of a forced token swap. He works on getting Steem listings. He advocates for continued development of SMTs. He gets devs facilitating voluntary exchange between Steem and Tron. He bullet points 3-5 major objectives in a product roadmap. He clearly states his plan is to incorporate steem into the Tron network as opposed to cannibalizing Steem into a Tron token on the Tron blockchain. He makes the roadmap public prior to March 6th and disucusses with the public on the 6th.
- Justin voluntarily switches steemit stake to non-voting.
- I'm betting Justin's contract has something like a delayed payment option where Ned has certain obligations. Justin does not pay Ned the rest of the money because Ned is a criminal, conman, and fraud.
- Justin takes the unpaid amount that was saved by not paying Ned the Snake and puts some in the Foundation (which could be used to sue Ned on behalf of the community), puts some into the dao, and burns some.
- Regarding the remaining portion he keeps some on steemit for development and onboarding, he takes out 10% into a personal account to give him personal financial incentive to grow this place.
So, it would overall look something like:
Why not more to the Dao?
Having money in the Dao is great. Having too much money in the dao will lead to abuse. This is a compromise.
Why put anything in the foundation?
It decentralizes this community from having to fully trust a centralized private entity to a non-profit community based organization. The current biggest problem with the foundation is that it lacks funding. This gives it a financial footing to start from.
Why should steemit have any funding?
This is probably the most contentious part from the rumblings I hear. The argument is that they have not been good enough stewards to keep anything and maybe witnesses should fork regardless of what Justin says or does and just walkaway from Steemit entirely.
I understand that perspective. I don't maintain it personally. The devs are exceptionally bright people and if given time and freedom to code we'll get good advancements out of them. Giving them some runway and some bandwidth on Steem is a good thing for onboarding and growth.
Burning helps all token holders. Would be good to see a reduction in supply even if it's just a token demonstration.
Why should Justin get to keep anything?
Justin is likely a victim in this too. The goal is not to exact punishment on a man who just got swindled by Ned. The goal is to give him a way to get his investment returned by helping grow the chain at least back to ~$1USD/Steem again. If he has 10% of what's there then there's a remedy for him to get his money back from Steem: Grow the value!!!
Anyway, that's all just a suggestion. Justin has choices to make.
Justin has to make his intentions known and put his roadmap out publicly. By writing this I'm trying to help Justin and the Steemit team, which has talented coders, but is often tone deaf as an organization to help them see one potential path that touches on concerns.
Effectively seeing softfork 0.22.2 pop up out of nowhere is like a check engine light coming on that something is broken, but I'm betting they don't fully understand what it means or indicates. I'm trying through this writing to inform them and give one possible set of directions that I think would get this chain operating effectively going forward.
After Justin has stated his goals, put out a multi-point product roadmap, and met with the community on the 6th the witnesses have to evaluate the plan, see if we can come to terms, and then code whatever is necessary to ensure it's trustless. We could all fork. We could all stay. Some could fork, some could stay. But in order for this to resole we all need some time to code up plans.
Well, once we've figured out where we've landed and time has been set aside for coding then things get enacted. Steem presumably gets a steemit-supported hard/soft fork and forks are either avoided entirely or given enough time to start. Then everyone can make their decision of where their primary online residence is and we can all Steem/neosteem/psuedosteem on.
Just me here
I'm not representing any app, other witness, foundation, or anything else. This is just my personal reflections based on what I know, some of what I've picked up, or what I've deduced so far. This post is meant to help confused users get additional reflections. It's meant to help the Tron guys successfully navigate a difficult transition. It's meant to help people comprehend the magnitude of Ned's actions. It's meant to help those that are angry, afraid, or outraged figure out at least one perspective on why the softfork was necessary and scope some of the challenges that are coming our way. I'm not a lawyer and my opinions of Ned's actions likely need legal review, but from a pretty simple vantage point his actions look criminal to me.