The oldest Bitcoin mining pool, Slush Pool, has confirmed that it does not interact with cryptocurrency addresses on the OFAC sanctions list of the U.S. Treasury.
— Mike Kelly (@mikekelly85) February 7, 2021
Coin Metrics analyst Karim Helmy explained that censorship applies only to payouts to miners who have attracted the close attention of U.S. authorities.
Slush Pool does not engage in such practices for other transactions, as it is not a money transmitter, Helmy added.
Slush pool doesn’t censor on-chain txs in any way, mining pools aren’t money transmitters and processing OFAC txs isn’t considered interaction. They just don’t send payout txs to OFAC miners.
— karim helmy 🦌🏝 (@karimhelpme) February 7, 2021
Developer Bob McElrath criticized Slush Pool’s approach. In his view, attention to OFAC addresses could be followed by censorship of tax evasion, disclosure of undeclared private wallets, and transactions on the grey market. Ultimately, he says, any user would be at risk.
McElrath urged resisting such actions and not letting miners become a division of financial intelligence, as banks have done.
If you believe in censorship resistance as a value proposition, we need to push back hard on these ideas and reject them. While it may not affect you now, its use will be expanded until it does affect you.
Don’t let miners turn into financial police as the banks have.
— Bob McElrath (@BobMcElrath) February 7, 2021
He is confident that such pools will be significantly less popular than their Chinese counterparts until the latter engage in censorship.
It’s worth noting that these censorship-friendly mining pools Just Won’t Work as long as alternative pools like the chinese pools are still operating and not censoring. This is mostly about optics for regulated investment into mining.
— Bob McElrath (@BobMcElrath) February 7, 2021
Earlier, the custodial service BitGo paid an OFAC fine after accusations that it provided services for its hot wallet to individuals in sanctioned countries.
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