$5 Million Worth of Tokens to Be Seized by Steem Hard Fork

Key highlights:

• Steem witnesses decided to seize the assets and accounts of several users who disagree with TRON's buyout of the blockchain in a forthcoming hard fork
• The decision is part of a long-running dispute between TRON CEO Justin Sun and Hive supporters
• Ethereum creator Vitalik Buterin slammed the hard fork

A hard fork has been scheduled for May 20th, during which 23.6 million STEEM coins worth roughly $5 million will be seized from the accounts of several Steem users. The hard fork has received plenty of criticism because it's perceived as a way to penalize those who opposed Justin Sun's actions on the Steem blockchain in February 2020.

The decision to seize assets is part of a long-running dispute 

The story starts in December 2019, when TRON founder Justin Sun bought the Steemit blogging platform, and gets further complicated by events in February 2020, when the entire list of active Steem witnesses was replaced in what many called a hostile takeover of the Steem blockchain. 

Many members of the cryptocurrency community are criticizing the fork, labeling it as a punishment for those that opposed Sun and supported the Hive hard fork in March. Hive is a community-led fork of Steem that intentionally excluded accounts that owned STEEM tokens from Steemit Inc.'s "ninja-mined stake" and also excluded those who were allegedly contributing to the centralization of the Steem blockchain. 

Justin Sun’s move to freeze 23.6 million STEEM tokens enjoys the support of network validators (called ‘witnesses’ on Steem). Witnesses agree that account holders targeted by the hard fork are posing an existential threat to the Steem network.

In a recent interview with Joind, Steem witness Triple A accused the accounts whose funds will be seized of spreading fake news, writing offensive and pointless spam comments, publicly attacking users, collecting personal information, and even making violent threats.

The hard fork will affect 64 users

The code for the scheduled fork includes 64 users whose accounts and funds will be frozen with the coming upgrade. Some of these users already responded on Twitter.

A soon-to-be-sanctioned Steem user nicknamed ‘pharesim2’ stated:

“The witnesses accuse all of us of criminal activity, without presenting any proof. My stake is currently worth >80,000€. I bought 500,000 last year”. 
‘They Call Me Dan’ is one of the users with the most funds being seized. He revealed in a Tweet that he will lose $600,000 of his funds. 

Affected users are already preparing a class-action suit

While not many users will be affected by the hard fork, the drastic approach of freezing user funds in a supposedly decentralized network still raises a lot of concerns.

The targeted users are now asking the crypto community to petition to exchanges not to implement Steem’s proposed hard fork, threatening civil liability should they support the fork.

Ethereum founder Vitalik Buterin also commented on the controversy on his Twitter account:

Shouldn't every steem user just be moving to hive at this point?

— vitalik.eth (@VitalikButerin) May 19, 2020