Steem Soft Forks to Sanction Mysterious 'Community321' Account

Steem has executed a soft fork to restrict the rogue “community321” account from making transfers after the account sent nearly 24 million STEEM to Bittrex in protest of a hard fork that sought to freeze the funds.

While Steem has claimed that the hard fork was intended to protect the Steem community against malicious actors, critics claim it was intended to punish supporters of the Hive hard fork by freezing their funds.

Steem sanctions community321

An update posted to Steemit on May 22 announced the completion of a soft fork sanctioning community321, stating that “the community no longer has control over the account.”

On May 21, Steem completed a hard fork to freeze 23.6 million STEEM associated with Steem stakeholders who supported the community-led Hive hard fork.

Hive opted to freeze the founder’s reward of roughly 20% of the total Steem supply that Tron founder Justin Sun inherited alongside purchasing Steemit in February to prevent Sun from exercising voting rights on the new chain. Critics have described Steem’s recent hard forks as spitefully motivated efforts to punish Hive’s organizers and proponents.

Mysterious 23.6m STEEM transfer yet to be resolved

However, Steem’s latest hard fork saw the 23.6 million sequestered funds mysteriously sent to a Bittrex wallet after being seized and sent to the community321 wallet. Data on the Steem blockchain explorer reveals that community321 requested that Bittrex return the funds to their owners as of before the fork:

These are funds stolen by the Steem witnesses using HF23 May 20th 2020 - please return them to their original owners prior to the fork :)

Bittrex cofounder, Richie Lai, has since indicated that it is carefully reviewing the facts surrounding the transfer, emphasizing that “What happened during the hard fork and the allegation that the community321 account was hacked outside of the Bittrex ecosystem are two separate issues.”

“We cannot conflate these two issues,” Lai added.

Due to a lack of identifying data associated with the transfer, the funds have since been classified as unclaimed — where they will stay “until a user can prove ownership.”