DeFi Prone to State Censorship, Decentalized in Name Only
Ethereum has begun showing centralized cracks in its foundation as the US government continues its attempts to mold Bitcoin and “crypto” into an extension of the current state-controlled monetary system. One that deems half the planet unbankable because of where they happen to be born in.
Only Bitcoin will withstand the incoming regulatory tsunami through true decentralization because ETH is so resource intensive it requires expensive hardware to run which is why the majority of ETH nodes are run on servers.
ETH and DeFi are showing themselves to be entirely susceptible to state censorship.
Most mEtH nodes run on Amazon and Google, which begs the question, how long until they get forced to run OFAC compliant Nodes?
A handful of companies most of which are based in the United States run those servers, making them an easy target for government capture.
This is Happening Now: The DeFi protocol AAVE is blocking Ethereum addresses linked to Tornado Cash
The CEO of Tron, Justin Sun, is censored after being sent 0.1 mEtH from Tornado Cash.
Shitcoins and DeFi are D.I.N.O.’s: Decentralized in Name Only
On Monday, reports stated that the open source tool Tornado Cash had been blacklisted and sanctioned by the US government through the Office of Foreign Asset Control.
Following Monday's sanctions, users targeted celebrity accounts by dusting their addresses with "marked" ETH. Those dusted include Vitalik Buterin, Brian Armstrong, Steve Aoki, and Shaq, to name a few.
Is this Systemic Risk for eth and DeFi: Denied Finance
We have seen significant liquidations and bankruptcies from the lending sphere of the industry as of late, with scammers like Celsius, Three Arrows, Voyager, and more driven to bankruptcy or bailout. However, a significant attack vector was laid out by Twitter users putting the pieces together since the blacklisting Monday.
Pretty sure Maury would say AAVE and ETH have failed the lie detector test.
Some refer to ETH as the centralized JP Morgan protocol, but those who run, host, and control the nodes; ultimately control the protocol. (Amazon)
According to PeckShieldAlert, approximately 600 accounts received 0.1 dusted ETH from the Tornado Cash 0.1 ETH contract
These accounts include centralized exchanges and individuals within the "cryptocurrency" community.
People are under the impression that "decentralization in DeFi" is in jeopardy due to several Defi platforms blocking addresses.
These platforms include Aave, Uniswap, Balancer, dYdX, Alchemy, and Infura. In addition, services associated with the cryptocurrency mixer have been disabled from websites such as Discord and Github.
AAVE has yet to release any statement regarding the censorship and has falsely advertised as a decentralized protocol.
Financial liberation can be found in the one true decentralized protocol and the new hard money standard of the planet, Bitcoin. To become your own bank, join the Peaceful Revolution and exit Fiat and its crony Cantillon continuance, “crypto”.
Check out this episode of Simply Bitcoin for more on how DeFi and ETH are prone and open to state censorship below