Today, Brian Fabian Crain, CEO of Chorus One, tweeted a screenshot showing that Binance has submitted 55.81% of all votes on the TRON proof-of-stake network.
“What a joke: @binance controls 56% of the voting power on @tronfoundation. If they split their votes across 25 nodes, they’d have 499k per node and would control 25 out of 27 validating nodes. Decentralization theater. Centralized exchanges are an existential threat for crypto.”
TRON has a slightly unintuitive voting system in which 27 “Super Representatives” make all decisions. Any holder can still “freeze” (stake) their TRX to vote for representatives, but those stakers can also vote for themselves. This is exactly how Binance became the most powerful voter, staking 12 billion TRX tokens to vote themselves into office.
A big congratulations to our newest SR @binance. ???
Binance rocketed to the top of the #TRONSR today with more than 12,000,000,000 votes!
Check out https://t.co/VxhQhE7giQ for all the details! #TRON #TRX $TRX pic.twitter.com/bVCSlXCGzE
— Justin Sun (@justinsuntron) October 1, 2019
Super Representatives are frequently revoted, but there is no limit to how long they can hold power. Each TRX token equals a vote, and 12 trillion votes would equal the equivalent of 168 million dollars at the current price of $0.014.
Tron isn’t the only “decentralized” operation that ends up looking like a plutocracy. We have reported that even the reputable MakerDAO platform, creators of the DAI stablecoin often have one rich voter making important decisions.
Arguably the biggest update to ever hit maker, Multi-Collateral Dai was given a 3 day vote to be implemented, and would require $100 million with of DAI to be manually converted, had one voter controlling 50% of power for a majority of the duration. They ended up providing around 35% of the consensus.
Ethereum, the second largest market cap coin is in the process of moving to a proof-of-stake network, and some people are fearing for it’s security. There won’t be a voting system implemented like in TRON, and it would cost way more to take over the network, but TRON and Maker’s voting system are good examples of what can happen when allowing money to control the blockchain.