Major Steem stakeholder Dan Hensley has levied heavy accusations at TRON founder and CEO Justin Sun. According to Hensley’s April 8 writeup, Sun “bribed” his way to the top of the Steem hierarchy with “money, power and users.”
As Cointelegraph reported in early March, Steem was the subject of what many supporters deemed a hostile takeover by Justin Sun. Hensley’s latest allegations shed new light on how the TRON founder allegedly influenced prominent Steemians into doing his bidding. A TRON representative declined to comment on this story.
In a conversation with Cointelegraph, Hensley described Sun’s intention to circumvent established community voting rules. Hensley said:
“Justin was losing the voting war halfway through and started offering people $2,500 each month to run a witness node for him on Steem. I own a dApp called 3speak that was on Steem, he offered us money, power and users.”
Steem’s proof-of-stake voting war
The “war” in question was the voting procedure used to select 20 delegated witnesses to oversee the Steem blockchain. In Steem’s delegated proof-of-stake model, coin holders make their voices heard by staking funds with the witness that they feel best represents their interests.
According to Hensley, Justin Sun sought to slice through Steem’s decentralized voting model by paying users to vote for witnesses that he had set up himself. Hensley accused Sun of bribery:
“He said all we had to do was get people to stop voting for the community witnesses and vote for his witnesses. We refused. He also was bribing users in Discord saying anything they wanted to hear for votes.”
Neither party has so far publicly shared screenshots of these conversations to confirm their veracity. Even so, the allegations are significant in that Hensley is making them under his own name, writing up his experience in detail, and publishing it online.
In Hensley’s opinion, Steem’s legitimacy as a decentralized blockchain has been decimated by Sun’s takeover. He went so far as to suggest that Sun’s domination of the Steem blockchain has rendered the STEEM cryptocurrency a centralized security:
“He [Sun] turned STEEM into a centralized security, all of the witnesses are propped up by him. He calls them “community” witnesses but he votes from them with secret accounts that I can prove belong to him.”
The lineup of Steem witnesses has changed dramatically since the Justin Sun saga began. Former Steem witnesses claim they can link the new lineup directly to Justin Sun himself, although no hard proof has been forthcoming thus far.
Steem witnesses censored
The drama began in March when Binance, Huobi and Poloniex used their customer’s staked funds to vote for Justin Sun’s new Steem witnesses. This led to an uproar from the Steem community, after which Binance removed its funds from the voting pool. Hensley contends it was too late to make a difference, however:
“We were very close to retaking the chain, and as soon as the first round of powerdown for steem hit Binance, guess who got it? Justin was VIP and withdrew before anyone else, solidifying his position and thus helping Justin stay in power on Steem.”
Some who refused to become indebted to Justin Sun claim to have had their Steemit accounts censored. A former top 20 Steem Witness from before the takeover, “TheMarkyMark,” had his account with more than three years of user history wiped clean, and his ability to publish on Steemit.com was removed. He told us:
“Justin Sun has also suppressed a lot of users by completely removing access to all their posts and comments, basically censoring the user from being able to use the platform in any meaningful way. In my case, around 10,000 posts and comments over the last 3+ years have been removed.”
In response to Sun’s apparent takeover of the Steem blockchain, Hensley and others supported a hard-fork of the project. That new initiative, Hive, is almost an exact copy of the original Steem blockchain. The project’s main qualifier, however, is that it is free from the influence of Justin Sun.
But according to the former witness, any mention of “Hive” on Steemit is met with account deletions and censorship:
“There are around 20 users who have been completely censored and removed from the front end interfaces, even those not owned by Steemit Inc and last time I checked a few weeks ago, hundreds of posts have been removed just for mentioning the word Hive.”
When users want to withdraw their funds from Steemit, the coins are subject to a “powering down” period. Some who wish to leave Steem in favor of Hive are being held back due to the staggered way in which their STEEM coins are released.
This made many unwilling to speak out against Justin Sun out of fear that their money will be withheld.
Others, including Hensley, say they are holding back incriminating proof that will let them retain leverage over Justin Sun while their coins are slowly released.
Joseph Spezzano received a Masters Degree in computer science from The University of Massachusetts. Joseph has been working as a full-time blockchain programmer for the past 5 years. In his spare time, Joseph enjoys writing for CryptocurrencyInvestments.com and traveling.