US regulation is killing the crypto spirit

Overbearing US Regulation is Dampening the Crypto Economy

From third-party review, completed self-review, the so-called anti-review cryptographic spirit has long been gone.

Last night, Bitcoin developer and observer @0xB10C published a report on social media titled “The Missing Six OFAC-Approved Transactions – Is the Asian Mining Pool the First Pool to Comply with US Sanctions?” The report points out that F2Pool filtered Blocks 810727 and 813357, and the missing four OFAC-approved transactions may have been filtered.

OFAC implements economic and trade sanctions against targeted foreign and regimes, terrorists, international drug traffickers, individuals engaged in activities related to the proliferation of weapons of mass destruction, and other threats to national security based on US foreign policy and national security objectives. or economically.

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F2Pool is the third-largest Bitcoin mining pool. When Wang Chun, co-founder of F2Pool, responded, “Why are you surprised that I rejected transactions from these criminals? CZ’s retribution is well-deserved,” he seemed to admit that F2Pool’s omission of transactions was not accidental. This response has since been deleted. But evidently, he believed he was right.

Optimistically speaking, the filtering of transactions by a single pool will not affect the censorship resistance of the entire Bitcoin network, and the Bitcoin network can still function normally.

But the sentence in the report, “But why is F2Pool, originating from Asia, the first pool to filter transactions according to the US OFAC sanctions?” is truly lamentable.

Yesterday, November 22, 2023, not only made history for Binance but also for the cryptocurrency industry as a whole. In order to reach a settlement with regulators, the largest cryptocurrency exchange in terms of trading volume, offered $4.3 billion.

CZ put aside the achievements of his six years of entrepreneurship and officially became part of the past, admitting to money laundering and violations of US sanctions, stepping down as CEO, and paving a stable path for Binance’s future.

CZ appears in the Seattle court, image source: GeekWire

US regulation is a move to “kill the chicken to scare the monkey,” and it puts every cryptocurrency practitioner in danger.

Starting from August 2022, the Office of Foreign Assets Control (OFAC) under the US Department of the Treasury announced sanctions against the cryptocurrency mixer Tornado Cash, stating that the service laundered over $7 billion in the past three years and helped North Korean state-sponsored hacker group Lazarus Group evade US punishment.

And this year, the SEC took its first enforcement action against an NFT project, accusing ImLianGuaict Theory, a media and entertainment company based in Los Angeles. ImLianGuaict Theory agreed to settle the lawsuit and will pay approximately $6.1 million in “restitution, prejudgment interest, and civil penalties.”

Furthermore, the regulatory scrutiny list also includes DeFi. Decentralized stablecoin protocol MakerDAO announced the launch of the DeFi lending protocol SLianGuairk Protocol, centered around the stablecoin DAI, but it is not available in the United States or for users with US IP addresses. The terms of service also prohibit US users from using VPN to hide their US residence, and VPN use is also prohibited for users outside the United States.

Before the “execution,” someone traded fines for regulatory “leniency.” Before the next round of arrests, the regulatory shotgun had just been raised and already scared away a group of people who did not want to be the next ones put on the execution ground.

Coinbase’s Chief Legal Officer published an article on March 22 titled “We asked the SEC for reasonable crypto rules for Americans, but we got legal threats instead.” The tone of the article is quite bitter, mainly talking about one thing, which is the futile effort to push the US Securities and Exchange Commission to clarify regulatory policies. However, according to the article, Coinbase actively sought compliance, had over 30 meetings with the SEC, and spent millions of dollars researching registration methods but received no response for 9 months.

While the young people in crypto are still immersed in the rebellious and pure spirit of crypto, the old guns are forced to think about the way out of “KYC,” “compliance,” and “regulation” under US regulation.

This year marks the tenth anniversary of the Snowden event, and the so-called “privacy” and “anti-censorship” of the crypto spirit have been killed by US politics and regulation, punch after punch, bending the backbone of the crypto spirit.

This is no longer the era of crypto, but the era of regulation. Far away, Snowden sighed helplessly for the crypto spirit.

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