Popular cryptocurrency exchange Binance has found itself embroiled in a bit of a scandal involving the Hive blockchain, as the exchange is going ahead with a seemingly unsanctioned token offering.
As the Malta-based exchange announced earlier today, the hard fork of the Hive.io platform from its parent Steem platform has been completed. The exchange also explained that it had decided to place the ratio of HIVE tokens to STEEM at 1:1.
While this is great news for prospective investors and users of the blockchain platform, there remains one significant problem; Hive Blockchain (not to be confused with Hive.io, the platform being promoted by Binance) has announced that its name shouldn’t be used by other companies.
In a cease and desist letter published recently, Hive Blockchain, a Canadian mining, and blockchain company, argued that all companies and projects using its name are unsanctioned and are infringing on its name in a bid to grow and drum up business for themselves. The blockchain firm especially took aim at the new startup, explaining that the latter was simply looking to use its name to woo potential investors.
What Led Us Here?
The Hive community successfully executed their fork from Steem earlier this month, after they had developer several conflicts with their former parent company. The community especially had problems with Justin Sun, the new owner of Steemit Inc. – a decentralized blog hosted on the Steem blockchain – and about 20 percent of the total STEEM tokens in circulation.
Steemit uses the proof-of-stake protocol, where a small number of witnesses are chosen by token holders to validate transactions and ensure the security of the network in general. However, after Sun had purchased the company and a significant percentage of tokens, many believed that he would use his majority to influence decision-making on the network and override dissenting opinions on how the network would operate.
Things reached a fever pitch on February 14, when Steemit announced that it would be moving from the Steem blockchain to the TRON network. After a publicized spat, the former Steem developers announced that they would be leaving the firm and setting up their shop. The fork was completed on March 20, and they went on to incorporate the Hive blockchain.
Enter: Hive Blockchain
Hive Blockchain was established in 2013. In its cease and desist letter, the firm explained that the Steem fork is looking to piggyback off the goodwill that it has generated in the crypto space.
Frank Holmes, the firm’s interim executive chairman, explained at the time, “As an early leader in the blockchain sector, we have invested significant amounts of money in developing our brand and educating the capital markets on blockchain technology and cryptocurrencies.”
Holmes highlighted that his firm doesn’t have any concerns with the Steem hard fork, except for the issue of its name. However, while they don’t have any particular opinions on Hive.io or any of its community members, they were spurred by a desire to preserve their interests and dispel any confusion that the fork might cause in the future.