Comment by legutierr | Hacker News Reader

Comment by legutierr | Hacker News Reader

> All transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons are prohibited unless authorized by a general or specific license issued by OFAC, or exempt. These prohibitions include the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any blocked person and the receipt of any contribution or provision of funds, goods, or services from any such person.

So, it seems that it is prohibited for US persons to send tokens to these smart contracts, or to withdraw tokens from these smart contracts.

What about miners running in the United States? Are US-based miners also prohibited from producing blocks that include transactions that interact with these smart contracts?

And what about blocks that are produced by non-US miners, and which contain transactions that interact with these smart contracts? Might US-based miners be prohibited from validating and building upon such blocks?

Does US law effectively now mandate a fork of Ethereum so that US persons can safely interact with a blockchain that excludes all interactions with Tornado smart contracts? It seems like an extreme implication, but can the possibility be excluded?

In terms of mining transactions, the Ethereum proof of stake system will financially punish anyone who fails to attest to honest transactions, and there's no escaping that just because "sanctions". See this post for details: https://0xfoobar.substack.com/p/ethereum-proof-of-stake

I believe we'll likely see other actions taken by US companies, such as Twitter banning the Tornado Cash account, Microsoft deleting its github repositories, the registrar of its current domain name disabling it, Discord kicking it off, and so forth. Perhaps large RPC providers refusing calls involving the sanctioned addresses, though I think that's less likely.

We will also see an escalation of fiat enabled exchanges refusing to do business with users who bring assets from Tornado Cash connected accounts, however there are other developments in the pipeline that will mitigate this, and increased aggression by proponents of financial exclusion will drive adoption as they are a real pain for legitimate actors too, and also these systems are necessary to increase transaction throughput anyway. (eg. rollup protocols on Ethereum, lightning network protocols on Bitcoin)

> Twitter banning the Tornado Cash account, Microsoft deleting its github repositories, the registrar of its current domain name disabling it, Discord kicking it off, and so forth

Perfectly happy to see all the centralized support crutches kicked out from under another poster child for fake decentralization rhetoric. Let's see how they do after they have to eat that dogfood for breakfast, lunch, and dinner, not just for dessert.

Agreed. As expected, Github has deleted it. Glad I cloned it all before I wrote any replies in this thread.

Edit: Authoritative AWS nameservers have now stopped resolving tornado.cash.

What do you expect to happen? Centralized service have better ux, so it makes sense for most people to use them - but nothing about ethereum or tornado requires them. People will only use their own nodes, tor and/or ipfs if that's the only solution that works - but as long as public rpcs like infura and normal domains aren't censored there's really no reason to (for a normal user, not a dev etc).

What's important is to keep that potential open, of course.

Sure, but also note that force was the only thing able to stop it - turns out the use case is there.

> Perhaps large RPC providers refusing calls involving the sanctioned addresses, though I think that's less likely.

It happened: https://twitter.com/0xdev0/status/1556933551073153024

As far as I can see, there is a big assumption in your assertion about proof of stake: that the stakeholders who want to comply with sanctions will be a minority.

How can this be enforced? They can’t block people from using it and they can’t(?) blacklist people from using the tokens that come out the other end.

> they can’t(?) blacklist people from using the tokens that come out the other end.

why not?

Because defi exchanges are also smart contracts. Unless you have an automated system that watches all tokens coming out of tornado and then immediately modifies the the exchange smart contracts to blacklist them it’s not feasible.

If exchange cant block such transfers, then it is possible that exchanges cannot operate legally.

Maybe locking account of user who use it will be sufficient.

I'm sure the smart contact language is powerful enough to specify that tokens from Tornado Cash will not be handled. You talk about it in terms of self-modifying code but that should not be necessary.

That tokens from "something like" Tornado should not be handled, though, seems like it would be harder to specify.

Just another tool for sweeping discretionary prosecution. Rest assured the government can get pretty much anyone on something civil rights destroying if they like.

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