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Steem Acquisition Mentioned in this Mainstream Crypto Podcast Yesterday | Is An Acquisition Possible on Hive?

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@khaleelkazi
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The Pomp podcast with Anthony Pompliano is one of the most listened to in the crypto space.

Yesterday, he interviewed Soona Amhaz and had a conversation about crypto that focused especially on the venture space, DeFi, etc.

Toward the end of the interview (at 48 minutes), they started talking about mergers & acquisitions in the crypto space. I was surprised to hear her response — saying that M&A’s in crypto are interesting, but the acquisitions of decentralized projects makes no sense “like the botched attempt to acquire Steem”.

This was the only reference point directly to Steem, but it’s always surprising to hear that prominent people in the space were actually paying attention to the events that unfolded in Justin Sun’s Sybil attack on the Steem network.

Playing off of those points, Soona continued to talk about acquisitions on decentralized projects and brought up some interesting ideas. They also mentioned the acquisition of Github as another example.

When they talked about the GitHub acquisition, they mentioned how a sort of community agreement was led. It alienated some members, but it allowed other members to come to an agreement over acquisition terms.

Reflecting on the Steem situation — what if Justin Sun had come to our community (as opposed to coming to Ned) and asked if we were interested in an acquisition deal. What if he struck a deal to acquire Steemit Inc., the Dev fund and proposed a roadmap for the entire Steem network. If the community agreed to his plans and a mutual benefit was identified, we could have all moved forward in an agreeable way.

Instead, they approached the “acquisition” as a hostile takeover and we all know how the story played out.

This prompts me to think about Hive. Many on Twitter have asked “what is different about Hive compared to Steem? Why won’t another Sybil attack take place?”

Hive's Decentralized Development Fund

A Sybil attack on Hive in the manner that Justin Sun carried out is no longer possible. There is no large development fund of ~70M+ steem HIVE to acquire which means that in order to launch a money attack against Hive, one would need to organize a massive amount of OTC deals AND have some sort of collusion with exchanges that held a lot of user HIVE.

With that said, what if someone came to the community and offered an agreeable acquisition. A non-hostile, mutually beneficial agreement to buy a bunch of HIVE and bring extensive resources to help push the blockchain toward new heights.

This might be a “decentralized acquisition” as they talked about in this podcast interview. Something where both parties (the acquirer and the Hive community) come to a mutual agreement and have a positive M&A event.

After being burned in the Steem hostile takeover, the Hive community is now taking steps to prevent another hostile takeover event. Closing up potential attack vectors and guarding the incredible value that this community has built over the years.

At the end of the day, I believe that the only merger or acquisition that can take place on Hive now and in the future is one where the community reaches a majority agreement to work with another entity outside of Hive.

What that structure would look like is questionable. If it would ever happen is another question. Even in the interview on this podcast, they mentioned that decentralized acquisitions don’t make much sense because there really isn’t much to acquire in terms of a truly decentralized network.

To tie this all off with a bow, I tend to agree that there isn’t much sense in a decentralized merger or acquisition. We saw this play out with Justin Sun (even though it was a hostile acquisition), but I also believe that the true value in a decentralized M&A lies in working with a community and building for a community rather than trying to own a piece of it.

Ownership is a funny concept in crypto and the decentralized world. We want individual ownership and we don’t want corporate ownership. In my opinion, corporations and whales like Justin Sun would benefit the most from finding ways to build things that first and foremost help a decentralized community and secondly help their balance sheet.

I continue to say this: as Hive community members, we’ve had a front row seat to a historical event in crypto and the decentralized landscape.

We got to witness the fundamental ideas of decentralization vs. centralization first-hand. Not only did we witness it, but we actually participated in it.

M&A’s in crypto are only getting more popular, but the key differentiator is the level of decentralization in the thing being acquired. In most cases, the projects/businesses being acquired are not decentralized but are instead centralized projects masquerading as decentralized projects.

Another interesting concept is the idea of Hive (a truly decentralized platform) acquiring another project as a community. I’m not sure how this would look, but it would be interesting to explore the scenarios.

   

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