So yesterday I got really bad anxiety all of a sudden.
I just felt like something was wrong or would go wrong. This is very unusual for me. I mean I have high social anxiety, but in this case I was just at home diddling around on my computer. I ignored the feeling for several hours.
Then I hop onto Discord 5 hours later just to see if anything weird happened.
BSC bridge had been hacked for $500M.
BSC bridge hack Twitter Link
Wow that is so random.
Reminds me of people who know family members have died without being told. I remember in college a friend of mine was hanging out with me because he had an extremely toxic on/off relationship with his ex-girlfriend. He wakes up in the morning after a night of partying and tells me:
Kate is pregnant
What?
Kate is pregnant, I had this crazy dream last night.
Yeah okay... but she's not though.
And then he calls her up right there and asks her, and she's all like how the fuck did you know that, nobody knows that, even I just found out about it.
Really goes to show you that there is a lot of weird unexplainable energy floating around in the world that we honestly know nothing about. Is every ghost story a hallucination or some other kind of trick, or is the truth of some of these matters far more strange than we could ever imagine?
To be clear, I don't think that me having anxiety and Binance getting hacked are somehow connected. How sad would that be? The power of the universe at my fingertips and I use it to divine the status of a centralized shitcoin. lol. That's just depressing. I don't want to live in that world, so I won't.
And shortly thereafter... this started circulating:
Haha... ha
It's pretty unclear if BSC actually has the level of decentralization that Binance constantly claims it does. I mean... you can't trust Binance on the matter, as they have an extreme financial incentive to make the claim that they don't control it, otherwise it would be an obvious security and investment contract with Binance corporation.
I did a tiny bit of research into how BSC operates a few months back. If I recall correctly it uses something called proof of authority. In theory, all nodes on BSC could be run by random community members. However, proof of authority gives Binance the ability to veto any block validator they wish. This in combination with Binance's seemingly never ending stack of BNB means they could easily be controlling every aspect of the network from the shadows. CZ acting like he's watching this all go down from a distance? Yeah, that feels like theater to me, but who knows.
Last time I posted this pic was within the context of the Steem/Steemit hostile takeover. Situations like these certainly do tend to have sock-puppet vibes. Binance says they are pushing an "upgrade" to the network. Oh, you mean you're forking away the hackers funds? The exact thing that created the Ethereum Classic DAO hack split? Of course with Binance it is guaranteed that there will be no fork. Why? Well we could argue that there isn't really a community.
The only way for the community to fork the BSC blockchain is to pick a new authority or eliminate those veto rights entirely. Is the BSC community capable of such a thing? I mean... probably? But maybe not, and even if so it would only happen if Binance was editing the chain in an unacceptable way. Taking away hacker funds is an acceptable change.
But once again this just brings up the idea of censorship resistance. If Binance can just change whatever they want, isn't it basically guaranteed that one day they will simply go to far, or even worse be captured by regulators. How long will the BSC community tolerate that kind of tomfoolery before they decide to fork the chain or create a new one? It's possible that it's only a matter of time before this kind of drama occurs. Not a matter of 'if' but 'when'.
We've already seen this pattern of behavior from Binance before. CZ knows exactly what he is doing. He walks the line well. Everything he builds is for a reason. If he builds a thing that has some decentralization built into it, it's only a little bit, and just enough to that Binance can claim they don't control the thing, even if they do.
We also see this with the Mandala exchange. Technically Binance corporation has fallen into KYC compliance and does not allow users to pseudo-anonymously access the system, but Mandala is allowed to use the "Binance cloud". So essentially what has happened here is that Binance bought out another company... integrated them into the system, and let's people use Mandala without KYC all the while acting like it isn't Binance... even though it's the exact same security and liquidity pools being used. Honestly it's impressive that he knows exactly how to tweak the system to squeeze through these loopholes.
Conclusion
Situations like this show us just how centralized most projects are. If anyone that builds on BSC gets hacked: deal with it. If Binance themselves gets hacked, they freeze the chain instantly and push an "upgrade" to the system. It's very obvious that this is a rules-for-thee-not-for-me scenario.
We still haven't even come close to seeing regulators move into this space. So far all they have done is issued a few fines for selling unregulated securities. None of these fines have actually destroyed any networks/tokens. Any token that has crashed to zero has done so because of the lack of its own merit.
However, it's quite obvious that soon regulators will try to flex a lot harder on certain networks. Already BSV (Bitcoin Faketoski's Vision) has created a blacklist that allows the miners to censor transactions that the government (or whoever else) doesn't like. The community and Craig Wright act like this is a huge accomplishment. As someone who actually appreciates censorship-resistance, I find it to be quite pathetic on every level.
It would be foolish to think that this same tactic will not be applied to Ethereum as well. How many people does the government have to strongarm to bring the entire network to heel? Two?
What I'm ultimately trying to say here is that these regulation crackdowns are going to cause a wave of hostile takeovers and subsequent forks that boot the bad actors off of the community run chains. As we all know, this is a grueling process that nobody wants to go through, but is necessary to maintain the independence and sovereignty of a digital nation. It's a very painful experience that creates an obscene amount of drama and lost value in the short term.
When these dominos begin to fall, many will look to the communities that have already had their "devastating hardfork" moment rather than stick it through on a chain that may or may not survive the attack. Bitcoin is safe. Can you think of another one?
Posted Using LeoFinance Beta
Return from There's Been a Disturbance in the Force! to edicted's Web3 Blog
