If funds in a wallet can be frozen or stolen without owner's authorization, have I been lying about blockchain tech?
I'm quite ignorant about blockchain tech. The only knowledge I have was the few I got when I was introduced to Steemit. I have tried to read up on my own, but I'm always confused. Although I know about the basic operations on the blockchain.
I'm basically here to share my content, connect with people and earn passive income by the side.
When I was onboarded on Steemit, I was told that the blockchain was decentralized and noone really owned it. And nobody could work my account unless they had my private keys. I was taught to guard my keys judiciously.
Now I'm confused when I read that people's funds can be stolen or frozen. Is that the way it works? If yes, then I've been giving people wrong information. And indirectly I've been lying to them.
I'm truly ignorant, and I'll love to be educated on this. If there's an article I can read to understand, I'll appreciate.
This is happening because Steem/Steemit is no longer centralized when one entity decides to do something he will do it by hook and crook. It is quite different here on Hive as of now, but say for example if someone wants to do out here on Hive he can do. Let me explain:
He will buy more than half of the Hive in circulation. Create his 20 witnesses and then made them do whatever he wants, though this is not super easy. Justin had done it because he got help from the exchanges who had a lot of money with them.
Oh okay! I understand you perfectly, and then your answer to my question is yes! Someone can actually possess the power to effect changes.
If that's possible, what's all the fuss about blockchain tech then?
Like I said, my knowledge on the technicalities of a blockchain is limited. But it's weird to know that someone with a lot of financial backing can tweak the blockchain to his/her bidding. Why then do we preach about decentralization?
The way I see it now, there's literally no difference with the banks that we are quick to throw jabs at.
Yes, if I talk about Steem it's no longer decentralized because all the funds are practical with Justin because he has bought it from Ned. But here on Hive, it's 99% with the community and no single entity is holding that fund, like proposal fund or any fund which will be community-driven.
But again if top witnesses here on Hive want something to be done of this sort, there are investors who can actually unvote them and vote someone who works for the community. Also out here, Exchanges will not take part in the witness decision which was not the case on Steem. So I think as of now Hive is decentralized as a whole. But again since there is too much power on the witnesses you never know. I am only talking about DPos system where financial backing have a say.
But Blockchain as a technology will be fully decentralized where the other party will not know who are you, and they will know with your BTC address or any address as such.
Thanks for the elaborate explanation. I'm glad to know all these now.
Wow.. that was really insightful @codingdefined
No longer decentralized*
It is technically possible to steal anyone's blockchain funds if the witnesses collude together (as they have done on Steem) and change the code at the blockchain level. Short of that, it's not possible, as long as only you have your keys. That's why we need to come up with mechanisms here to avoid the centralisation that we saw enabled on the Steem blockchain. Some good solutions floated include disallowing exchanges to vote on governance (i.e. no witness votes), and not allowing powered-up Hive to vote on governance until it's been powered up for 30 days. These things would stop what happened at Steem, and would give us time to take preventative action against any future Justin Sun type characters.
Wow! Thanks for clarifying. But then this information is quite scary; the knowledge that someone with massive funds can start a mutiny and succeed at it.
I'm here to share my content on this social space as I assumed it to be. I knew there was politics, I just didn't think it was that deep.
Well, I hope Hive does better though.
Yeah there's talk about implementing some measures to reduce the likelihood of what happened to Steem happening to Hive.
The distribution of Hive does not suffer from the same fault that Steem did. Part of the security model of DPOS is that buying enough stake to attack the network should be incredibly cost prohibitive. Unfortunately @ned, who controlled 51% of Steemit Inc, sold Stinc with all of its stake (which was always promised to be used for development and community) for pennies on the dollar to exactly the wrong person.
Hive doesn't have an overwhelming stake like Stinc's, and other measures are being implemented to shore up DPoS security further.
Well, going by your statement, you are kind of assuring me of the Hive's safety. Well, let's watch and see. I hope someone doesn't pull off a mutiny.
That's actually a really good question. I guess it's like many things in life, in that nothing is incorruptible or certain. For example, if we keep our money in the bank, they might protect that from hacking or fraud and make it as secure as possible, but we can only trust the say so of the bank. You may remember the bail-out of banks back in the GFC? The governments bailed them out that time, but if it happens again, they now have permission to bail-in. This essentially means they can use the money their customers have in the bank to prop themselves back up again. In the Ukraine, when they got independence, the new government had no money when Russia pulled out, so they took money from the people's bank accounts in order to establish the government.
Much of what we do relies on the trust of others and if someone is determined to take something from you and they're in a position to do so, there isn't much you can do to stop them.
This is some scary realisation of things for me.