Analysis

Hive Review: Steem Fork & Blockchain for Web 3.0

Hive is one of the newest blockchains on the scene, having been created on March 20, 2020 as a hardfork from the Steem blockchain.

This was no doubt one of the most contentious forks of 2020 given the people that were involved in it. One of the chief protagonists of this was none other than Justin Sun, the founder of Tron. Many viewed it as a takeover of the Steem ecosystem.

Irrespective of the infighting, is Hive worth considering?

In this Hive review, I will attempt to answer that by giving you everything that you need to know. I will also analyse the long term use cases and adoption potential of HIVE.

What is Hive?

Hive was created as the hardfork of the Steem blockchain and is meant to maximize the decentralization of the social blockchain following the corporate takeover of Steem and Steemit by the Tron Foundation and its CEO Justin Sun. Hive remains a social blogging platform that includes cryptocurrency rewards and promotes decentralized applications (dApps) and the use of Smart Media Tokens (SMTs).

The Hive platform allows users to post their own original written articles, which are stored immutably on the Hive blockchain. Creators are rewarded with the native Hive dollars (HIVE) by other users upvoting their content. The rewards are distributed based on an inflation mechanism that’s included in the blockchain code, and by the value of the HIVE token.

Benefits of the Hive Blockchain. Image via Hive.io

Users are also able to convert between Hive dollars and Hive power in a process known as staking. Hive Power are influence tokens which give users more control over post payouts and allow them to earn on curation rewards.

They also permit users to vote for the witnesses who govern the blockchain.  In a change from the original Steem chain Hive is requiring a 30-day vesting period for newly staked Hive tokens. This provides a delay in governance and voting and helps to avoid potential takeover moves.

Steem Fork

The hardfork of the Steem blockchain has actually been coming for a very long time, since the inception of the blockchain in fact. This is because at the very beginning, when the Steem blockchain was created, its creators carried out a ninja-mine that gave Steemit Inc. control over 80% of the STEEM supply.

This was made possible by not providing others with sufficient information to set up mining for the blockchain. Once Steemit Inc controlled 80% of the STEEM tokens mining was turned off and the blockchain switched to Delegated Proof of Stake.

Early adopters were understandably upset about this move, but the community allowed it to stand with the understanding that the ninja mined funds would be set aside for development, and would not be misused by Steemit Inc.

Steem Steemit
Steem Blockchain Run by Steemit Inc

That trust was upheld for nearly four years until the Tron Foundation acquired Steemit Inc and Steem in February 2020. The Tron Foundation also acquired the 80% ninja mined Steem stake, and began using them to influence governance on the blockchain.

This led to an attempted softfork by witnesses to prevent the Tron Foundation from locking the funds to prevent misuse. Because the Tron Foundation has strong ties to exchanges who hold large amounts of STEEM they were able to reverse the softfork and gain access to the locked funds. Justin Sun, CEO of TRON, allegedly used his own holdings to support the fork as well.

The response from the Steem community was to prepare for a hardfork that would see them part ways with Steemit and the Tron Foundation’s control over the platform and the Steem blockchain. That led to the actual hardfork and creation of the Hive blockchain on March 20, 2020.

Justin Sun Steem
Justin Sun’s Open Letter to the Steem Community

At the hardfork the Hive blockchain copied the Steem blockchain exactly, meaning all of the content created on the Steem blockchain to that point was now also part of the Hive blockchain. It also meant all the Steem accounts also exist on the Hive blockchain with a mirror of their STEEM, Steem dollar and Steem Power token balances airdropped to the HIVE wallets.

An exception to this is the Steemit Inc accounts and the accounts of those who supported the governance attack on the Steem blockchain. Those accounts were migrated, but they did not receive the airdrop of HIVE tokens. The 80% ninja mined stake was also excluded from the hardfork and does not exist on the HIVE blockchain.

Since the hardfork a large number of active Steemit members have moved over to Hive, and they have also begun the process of liquidating their STEEM holdings.

You would think that the hardfork would put an end to the disputes between the two groups, but each community has continued acting against the other.

Post Hardfork Rivalry

For example, the Hive governance tracker was used to identify several accounts that are believed to have been paid to act in Tron’s best interests. It is rumored that these accounts have been blacklisted from Hive, but it isn’t clear if these rumors are true. It is true that witnesses running the Tron 0.22.5 hardfork are not being allowed to produce Hive blocks.

Hardfork 0.22.888
Some of the Top 20 Hive Sympathetic Witnesses on the Chain. Image via Hive Blog

Steemit and the Tron Foundation have retaliated to these moves by releasing hardfork 0.22.888 which prevents 20 Hive-sympathetic witnesses from moving their Steem funds. Steemit has claimed this move is necessary to prevent hostility and spam on the network.

While the two controlling groups remain in conflict with one another this has not affected users. Basic users will find their accounts on both the Steem and Hive blockchains will work just fine, and they can continue to use one or the other or both.

Changes from Steem to Hive

The Hive hardfork brings several important changes to the blockchain immediately, with more changes expected in the coming weeks and months. The new Hive blockchain does not include the 80% ninja mined tokens, which was done as a prevention against centralization of the blockchain and potential censorship.

While the tokens haven’t been transferred to Hive, the founder’s accounts have been migrated (without the airdropped tokens) and they are allowed to participate in the new blockchain if they wish.

Hive Benefits
Some of the Main Benefits of Hive

The Hive developers have also increased the protection against governance attacks on the network by including a 30 day vesting period for new stakes and power ups of tokens.

This vesting period creates a 30 day delay in participating in the governance and voting on the blockchain, although no other actions are affected. There could be further governance changes made to the blockchain, but no changes will be made without first consulting the community.

Hive Technology / Use Cases

Hive maintains the Delegated Proof of Stake consensus (DPoS) model used by Steem. This allows for the use of Witnesses and for token holders to vote for those witnesses and to delegate their voting power to the witness of their choice.

The witnesses are tasked with maintaining and governing the blockchain. By removing the huge ninja mined stake on the Steem blockchain Hive is attempting to remove the point of centralization that allowed Tron to control the voting process and governance of the blockchain.

In addition to taking advantage of decentralized governance on the Hive blockchain users can also take advantage of the following technology features:

  • three-second block times;
  • free transactions;
  • scalability;
  • personalized names for accounts/wallets;
  • escrow capabilities;
  • a rewards system for social media, gaming, and publishing use cases.

The Hive blockchain has also implemented 9.5% APR inflation narrowing to 0.95% APR over 20.5 years. The inflation rate decreases at a rate of 0.01% every 250,000 blocks, or about 0.5% per year. This inflation calculation begins with hardfork 16 that was implemented in 2016. As new tokens are created they are distributed as follows:

  • 65% of inflation to authors/curators.
  • 15% of inflation to stakeholders.
  • 10% of inflation to block producers.
  • 10% of inflation to Hive Fund.

Dapps on The Hive Blockchain

Steem is the primary platform for Steemit, while Hive has hive.blog as its main platform. However a more useful platform called Peakd has quickly emerged. The Peakd platform is extremely useful since it not only includes the blogging features of the blockchain, but also allows for discovery of third-party dApps.

These dApps were becoming wide-spread on Steem before the hardfork, with nearly 100 dApps on the Steem blockchain, including the decentralized video platform DTube, an Instagram-like platform called APPICS, and the popular trading card game Steem Monsters.

Hive Dapp Stats
Some Dapp Stats on the Hive Blockchain

As of late April 2020 there are over a dozen dApps and games that have migrated from Steem or been newly created for Hive. These include the trading card game Splinterlands and the video platform 3speak. It is also rumored that the popular trading card game Steem Monsters is being ported for Hive.

For a list of the dApps, games, tools and other third-party extensions Hive Projects provides a blockchain search and directory that as of this writing lists 66 apps, sites and tools build by Hive community. Another directory is maintained at Hive What.

Team & Community

The Hive team announced from the beginning of the blockchain there are 30 core developers who are supporting the network. Many of these are former Steem witnesses and community members who had previously been heavily involved with the Steem blockchain.

In addition, they have said there are more than 80 others involved with development outside the core blockchain software. They also made it a point to let the community know that anyone who wants to contribute to the direction of the blockchain is free to do so, and that the future direction of the blockchain will be determined by community consensus.

The Hive About page reads:

With a diverse community of stakeholders and without controlling bad actors, individuals can experience true ownership in a decentralised blockchain & cryptocurrency.

In other words, Hive is dedicated to decentralization, making its strong community and its lack of absolute leadership its greatest selling point. So far this has been borne out by the community, which remains extremely committed to the message of decentralization.

The Decentralized Hive Fund

One of the extremely important, exciting, and innovative features that’s been added to Hive is its Decentralized Hive Fund (DHF), which is a trustless development model that earmarks a portion of the airdropped funds and future new tokens for the development of the project through community management.

At launch the Hive blockchain was able to maintain the same level of tokens as Steem by allocating a portion of the new HIVE tokens to the DHF as a way to create a large, robust pool of resources to help support the future growth of the blockchain and to support the community and the decentralized development of the network.

Decentralized Hive Fund
Funds Available in Decentralised Hive Fund. Image source Peakd

The DHF, which has also been referred to as the HiveDAO, can be used to fund the proposals made by community members. Users will also be able to vote for the proposed changes as they see fit.

Unlike the reserve of ninja mined funds held by Steemit Inc., the Hive fund has been created in a way the prevents a single person or group to gain control over the funds or to have control over large changes to the blockchain or the community.

Another crucial point with the DHF funds is that they’ve been time-locked to prevent a flood of tokens on the market. They will be slowly released by future Hive upgrades.

The Hive Tokens

Just as with the Steem blockchain, there are three different tokens used in the Hive blockchain. Each performs a different function with the ecosystem. The three tokens are the HIVE token, Hive Power, and the Hive-backed dollar.

  • HIVE – HIVE is the base liquid currency token in the platform. HIVE can be powered up into Hive Power, traded for Hive Dollars, or transferred to other accounts. It is a cryptocurrency token, similar to bitcoin.
  • Hive Power – Hive Power (abbreviated HP) is a measurement of how much influence a user has in the Hive network. The more Hive Power a user holds, the more they can influence the value of posts and comments. Hive Power is less liquid. If a user wishes to “Power Down” HP, they will receive equal distributions of the HIVE weekly, over a 13 week period.
  • Hive Dollars – Hive Dollars (commonly abbreviated HBD) are liquid stable-value currency tokens designed to be pegged to $1 USD. Hive Dollars can be traded with HIVE, and transferred to other accounts for commerce or exchange. Hive Dollars may also be converted into HIVE via a process that takes 3.5 days.

The price of HIVE shot up by nearly 800% from April 22, 2020 through April 27, 2020 as several major exchanges, including Huobi Global and Binance, listed the token for trading.

Hive Price CMC
HIVE’s Recent Price Performance. Image via CMC

That took the token from just above $0.11 to just above $0.82. The token has since retreated off its highs and as of April 29, 2020 it is trading at just over $0.44, giving it a market cap of $124 million and making it the 48th largest cryptocurrency by market cap.

It’s interesting to note that the original STEEM token is currently worth just under $0.20, or less than half the value of HIVE.

Hive Wallets

Hive wallets are available for Windows, MacOS, Linux, iOS, Android & Web. You can find a complete listing of currently available wallets here. There are currently seven wallets listed, including the native wallet that’s included with the Hive account.

Hive Wallets
Some of the Most Popular Hive Wallets

This is obviously the easiest way to store the Hive tokens if they were airdropped as part of the hardfork. Alternatively, Peakd functions as an improved user interface to the Hive blockchain and also includes wallet functionality.

Other options include:

  • Vessel, which is a lite desktop wallet that was originally released for Steem in 2017. It’s a popular option for those who want a more secure place to store their tokens.
  • Hive Keychain, a Chrome extension that also allows users to view all the Hive dApps right within their browser.
  • Hive Wallet, a mobile application for Android and iOS devices. It is advertised as secure and allows the addition of multiple accounts, and the use of QR codes.
  • Esteem, a beautiful and handy wrapper interface around the Hive blockchain network allowing you to create your own posts, surf your feeds, vote what you like, write comments, read replies, do all major Hive functions in your daily social surfing as well as wallet actions and other extras such as search, discover different tags etc.
  • Hivesigner is another Chrome extension app for managing Hive private keys.

Hive Roadmap

Currently there’s no official Hive roadmap as the development team has been busy working through the challenges presented by the hardfork. On a positive note the network has seen an increase in posting and engagement over its first six weeks of existence.

The code repositories are live and many bug fixes have already been implemented, and there have been a number of additional proposed changes and discussions of those changes. The community-based governance is working as expected.

In addition to that the network infrastructure is being reinforced to remain stable and secure, and there are more nodes coming online to increase network decentralization.

Hive Board GitLab
The Hive Development Board at GitLab

An increasing number of dApps and services are migrating from Steem to Hive, or are being developed exclusively for Hive. Most importantly, the community is increasingly active in development, governance, and activity.

Basically this is a period of great change, and also a period of great preparation and verification. There are many tasks associated with the creation of a new blockchain that are yet to be accomplished. The development team is tackling those tasks while also setting the groundwork for the future.

This has kept the focus for now on base code upgrades and deployment, API developments, the condenser and image hosting, and allowing the community to discuss proposals for the future.

Because Hive plans on remaining decentralized and allowing the community to propose and approve of changes an official roadmap may never be released, since the development of the Hive blockchain is dependent on the needs of the community.

Conclusion

While there are some benefits and strengths to Steem, the increased centralization that came with the purchase by the Tron Foundation was too much for many of the community members and witnesses who wanted a decentralized social network. This led to the hardfork that created Hive.

There are several qualities of Hive that are being promoted, chief of which is the decentralized structure of the network and the management of funds on the blockchain. The dApp ecosystem is growing quickly, and looks very promising as well, and with the involvement of long-time Steem users and witnesses the Hive blockchain is off to a good start.

Highlighting that good start was the April 2020 rally in the value of HIVE tokens, which made the blockchain far more valuable than its parent Steem blockchain. While that’s not the only characteristic that determines the success of a blockchain, it is one that could potentially bring more attention, and more users, to the Hive community.

Featured Image via Shutterstock & Hive

Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

The post Hive Review: Steem Fork & Blockchain for Web 3.0 appeared first on Coin Bureau.

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