Massive ego battles are a fairly regular occurrence within the crypto sphere. It's almost a rite of passage for a cryptocurrency--the founders of Bitcoin Cash, Tezos, Ethereum, and many others have been embroiled in them at some point. But in some of these battles, it can be difficult to tell where the egos end and serious allegations begin.
Earlier this month, Lucien Chen, one of the co-founders of the TRON network and the network’s former CTO, made a sudden exodus from the project. And Chen didn’t go quietly--on his way out the door, Chen made some serious allegations against the project and its founder, Justin Sun: he told the world that Tron has become excessively centralized--and that (by the way) his new project, the Volume Network, is much less so.
He said that although his decision to leave Tron was based on several reasons, the centralization of the network was the most significant reason. “As a technical man, I feel very sad that the Ton has departed from the faith of ‘decentralize the web,’” Chen wrote in a post made from a Medium account that has since by suspended.
Tron responded immediately, claiming that the allegations were false and that Chen’s exit from the company was an involuntary removal after he was suspected of being involved in fraudulent activity. However, many members of the Tron community have questioned the way that Tron handled Chen’s alleged dismissal, and whether or not there could be any truth to his claims.
Could there be more than meets the eye?
The Allegations
Chen wrote that “the DPOS mechanism of Tron is pseudo-decentralized.” In other words, Chen alleged that the distributed-proof-of-stake algorithm that confirms transactions on the Tron network is far more under Tron’s control than the company would like to admit.
Why does this matter? Blockchain networks depend on decentralization in order to be secure. In order for the security of a blockchain network to be compromised, more than half of the “nodes,” or computers that are responsible for upholding the network and completing the processes that confirm transactions.
On Tron’s network, the main nodes on the network, called Super Representatives, were elected by TRX holders when the network was launched. Tron’s network operates such that the Super Representatives are in control of the governance on the network.
Congratulations to all the 27 #TRONSRs, now we are in constitutional phase(after SRs replace GRs. Officially online). #TRON #TRX $TRX pic.twitter.com/Ea6yTeHd0b
— Justin Sun (@justinsuntron) August 22, 2018
Chen said that the problem is far worse than most may have imagined: “the top 27 SR nodes (block nodes) have more than 170 million TRX votes, and most of them are controlled by Tron,” he wrote, specifying that “more than 90% of the votes with only a few voters,” and that “the total number of TRX in Tron is 100 billion, while the total number of votes for the super representatives is just less than 8 billion.
“Token distribution is centralized, Super Representatives are centralized, code development is centralized. Even the community is organized under centralization.”
Additionally, the Super Representatives that are currently in power are unlikely to be forced to relinquish their hold anytime soon: “it’s hard for other latecomers to become block nodes, so they cannot participate in the process of block production,” Chen wrote.
Tron’s Response
Tron’s clapback toward Chen was made on the r/Tronix subreddit, which was taken over by Tron several weeks ago after Game of Chain (GOC), the gaming platform that exists on the Tron network, allegedly attempted a takeover of its own.
Tron said that not only was Chen not one of the network’s co-founders (he was merely a technical leader), but his exit from the company was not his choice at all. Rather, Chen--along with two other Tron employees-- was fired in January for suspected involvement in illicit activities.
A reported response from @Tronfoundation on the dismissal of CTO Lucien Chen, J. Zhu & X. Xie in Jan 2019 due to suspicion of misappropriation of funds, bribery, competitive infringement, & theft of trade secrets & intellectual property#TRON Reddit link:https://t.co/LeotF31NsS pic.twitter.com/RYMsn2J9rw
— Misha Lederman (@mishalederman) May 11, 2019
“According to the inspection department of TRON, former employees Z. Chen, J. Zhu, and X. Xie are suspected of misappropriation of funds, bribery, competitive infringement, and theft of trade secrets and intellectual property,” the statement read.
“Chen, Zhu, and Xie were dismissed in January, 2019 (sic) for violation of corporate policies and the law. Relevant documents and materials have been handed over to the judiciary. Z. Chen joined TRON in October, 2017 not as a co-founder but rather a technical leader.”
Not-So-Perfect Timing
However, the decision to announce Chen’s dismissal only after he came out and spoke against the Tron network struck some Tron community members as--well, odd.
“I appreciate the update from TF,” wrote Reddit user Classic_Patrick. “However, if they were dismissed in January, wouldn’t that be part of keeping the community updated about something this significant? Even if they weren’t able to give details about the dismissal.”
Other users weren’t quite so diplomatic. “Apparently the ONLY place its (sic) been disclosed is to the mod of this subreddit. No one else anywhere at all has been told. No announcements, no journalists, no press release, no official statements... not even Trons own devs know because they have apparently been still developing and publishing code while they have been dismissed,” wrote spritefire, another Reddit user.
Whether or not there is any truth to Chen’s allegations, the way that Justin Sun and the Tron Foundation handled the situation seems to have rubbed many community members the wrong way.
“Getting a more detailed account would do a lot for the credibility of the Tron foundation provided they handled this situation correctly,” another Reddit user wrote. “I'd go so far as to say I'd be much more confident in the direction of the company if we saw how Justin Sun handled a high level employee/employees when they're damaging the company.”
Tron Has Misled Its Community Before
Of course, it’s possible that Justin Sun and the Tron Foundation were legally restricted in terms of what could and could not be disclosed in relation to the firings.
However, the lack of information around Chen’s firing seemed to many to be just another addition to a long list of rather sloppy mistakes and mishaps that the Tron Foundation has made.
Perhaps the most egregious of these mistakes are the misleading statements that Tron founder Justin Sun has made about several partnerships that weren’t.
There have been at least two incidences of this--in October of last year, the Tron Foundation allegedly claimed that it had formed a partnership with Chinese tech firm Baidu. However, it was quickly revealed that Tron merely purchased cloud computing services from the company.
1/ ODaily: The 'partnership' between Baidu and Tron is basically about Tron buying cloud computing resources from Baidu. "The two parties have made no contact at the blockchain business level".
Source(CN): https://t.co/GXu0KsbtGX — cnLedger (@cnLedger) October 15, 2018
Another incidence of this occurred just last week when Tron Founder Justin Sun tweeted his excitement over a “new partnership” with Liverpool Football Club.
Thank you for the unique and innovative invitation, Liverpool! I am impressed and I'm looking forward to exploring this #TRON new partnership together! @LFC #TRX $TRX #BTT $BTT ?? pic.twitter.com/7RhFw7QVbX
— Justin Sun (@justinsuntron) April 24, 2019
However, a spokesperson for Liverpool Football Club quickly denied Tron’s claims, saying that “Liverpool Football Club has confirmed that it does not have a partnership with Tron." Kraken founder Jesse Powell tweeted that Justin Sun’s tweet probably referred to a “spam” sales pitch.
I think we all got spammed with the same sales pitch. I get 100 of these a day. @decryptmedia pic.twitter.com/WK0iHgHpdV
— Jesse Powell (@jespow) April 24, 2019
Other Mishaps
On top of the misleading statements about partnerships, Tron has had several other mishaps that have made users doubt its integrity. Last year, Tron came under fire for allegedly plagiarizing parts of its whitepaper--Justin Sun explained that the plagiarism was the result of shoddy, crowd-sourced translation.
Another recent incident involved a Tesla giveaway gone wrong. Tron announced that it would be giving Tesla cars to some of its randomly selected Twitter community members. However, it appeared that most of the chosen winners were bots; a human Twitter follower that was selected was told that actually, he was chosen by mistake, and that he would receive free tickets to an upcoming Tron conference instead--this did not go over well with the community.
Are you for real Justin Sun? Everyone in the community saw you do this draw live and declare this guy UzGar the winner. Do you deny these facts? Put yourself in his shoes... Do the right thing here Justin. Everyone is watching. ?
— Drew (@blocksurfing) March 29, 2019
Could There Be Any Truth to Chen’s Accusations?
Chen’s loud exit from Tron and the opportunistic shilling of his own project certainly smell strongly of a conflict of interest. However, there could be some truth to what he was saying.
While there isn’t any scientific proof behind Chen’s words, he isn’t the only person to point the finger at Tron and projects like it. Last year, Ethereum creator Vitalik Buterin said in February that while algorithmic models similar to Tron’s may be able to run more transacitons per second, their security and decentralization is often compromised.
“When a blockchain project claims ‘we can do 3,500 TPS because we have a different algorithm,’ what [it] really means is ‘we are a centralized pile of trash because we only have 7 nodes running the entire thing,” he said at the Blockchain Connect Conference.
Users also began to question Tron’s decentralization when the network made the decision to take over the r/Tronix Reddit feed. While Tron alleged that the move was made in order to protect the integrity of the information that was shared on the feed, members of the Tron community saw things differently.
Time for Tron to Clean Up its Act?
“This is centralization of power and control of communication,” wrote user aesthetik_--and while the Reddit takeover was not exactly network centralization, “if they only allow posts relating to apps with financial interests aligned to generating profit for themselves and remove competition, then this project will rapidly form a cartel structure stripping wealth from its members for the benefit of a few."
The problem with many platforms and networks in the cryptosphere at this moment in time is that serious problems are often only identified after it's too late. If Tron is overly centralized, the world will probably only know the extent of the problem after something unfortunate has happened.
Regardless of whether or not Chen's allegations are true, the network needs to take steps to show its community that it is trustworthy--and that it prioritizes its users' best interest over making profits.
