Ethereum is Getting Closed to Being Completely Censored Because of OFAC Regulations
Godfrey Benjamin Nov 05, 2022 18:30
Ethereum is becoming more compliant with OFAC sanctions per on-chain data
The percentage of OFAC-compliant Ethereum blocks being created every day has increased to 73%, which heightens censorship worries in the blockchain ecosystem.
Following Ethereum framework censorship that posits barriers to the crypto ecosystem's goal of extremely open and accessible finance, the market has been monitoring Ethereum's increasing adherence to guidelines set forth by OFAC. As per the development, over 73% of the blocks on the Ethereum network in the past 24 hours have been determined to enforce OFAC compliance.
Following the discovery that 51% of-Ethereum-blocks met OFAC requirements back in October 2022, top crypto media firms published an article on the growing censorship issues. But according to mevWatch data, as of November third, daily block production that complies with OFAC regulations has increased to 73%.
Meanwhile, some OFAC-mandated MEV-Boost relays would censor financial activities. Consequently, to guarantee Ethereum's neutrality, a non-censoring MEV-Boost relay must be implemented by the network.
Additionally, by removing relays like BloXroute Max Profit, BloxRoute Ethical, Manifold, and Relayooor from their MEV-Boost configuration, Ethereum examiners can lessen their adherence to OFAC regulations.
US Government Agency Enforces Sanctions on Crypto Outlets
Based on the adherence to OFAC, the United States Government agency can apply economic and trade sanctions on crypto outlets. Meanwhile, Tornado Cash and several Ethereum addresses had already been sanctioned by the agency. Furthermore, as of the time of writing this report, 45% of all Ethereum blocks are in full adherence to the OFAC regulations.
Following the launch of crypto exchanges by UnionBank, one of the biggest multinational banking institutions in the Philippines, in collaboration with the Swiss crypto company Metaco, the adoption of Bitcoin BTC tickers fell by $21,265 while Ethereum accelerated.
This suggests that despite the alleged censorship of the protocol, it is still widely used today.
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