BREAKDOWN: Tether Chooses to ‘OFAC Around and Find Out’
CoinDesk Podcast Network
CoinDesk
4.8 • 689 Ratings
🗓️ 25 August 2022
⏱️ 19 minutes
🧾️ Download transcript
Summary
The stablecoin issuer says it won’t blacklist addresses unless law enforcement specifically asks it to do so.
This episode is sponsored by Nexo.io, Chainalysis and FTX US.
On today’s episode, NLW looks at the latest news on Tornado Cash sanctions. Specifically, he looks at Tether’s announcement this week that the stablecoin issuer would not blacklist addresses from Tornado Cash unless U.S. law enforcement specifically asked it to do so.
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I.D.E.A.S. 2022 by CoinDesk facilitates capital flow and market growth by connecting the digital economy with traditional finance through the presenter’s mainstage, capital allocation meeting rooms and sponsor expo floor. Use code BREAKDOWN20 for 20% off the General Pass. Learn more and register at coindesk.com/ideas.
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“The Breakdown” is written, produced by and features Nathaniel Whittemore aka NLW, with editing by Rob Mitchell and research by Scott Hill. Jared Schwartz is our executive producer and our theme music is “Countdown” by Neon Beach. Music behind our sponsors today is “The Now” by Aaron Sprinkle and “The Life We Had” by Moments. Image credit: sesame/Getty Images, modified by CoinDesk. Join the discussion at discord.gg/VrKRrfKCz8.
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Transcript
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| 0:00.0 | Welcome back to The Breakdown with me, NLW. |
| 0:09.2 | It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world. |
| 0:14.8 | The breakdown is sponsored by nexo.io, chain aliasis, and FtX, and produced and distributed by CoinDesk. |
| 0:22.8 | What's going on, guys? It is Thursday, August 25th, and today we are talking about the latest |
| 0:28.2 | in OFAC sanctions around Tornado Cash. Before we get into that, however, if you are enjoying the |
| 0:33.5 | breakdown, please go subscribe to it, give it a rating, give it a review, or if you want to dive |
| 0:37.6 | deeper into the conversation, come find us on the Breakers Discord. You can find a link in the show |
| 0:41.9 | notes or go to bit.ly slash breakdown pod. Also, a disclosure as always, in addition to them |
| 0:47.2 | being a sponsor of the show, I also work with FTX. So today, we're discussing the continued |
| 0:52.5 | fallout and response to sanctions of Tornado Cash. And specifically, we're discussing the continued fallout and response to sanctions of tornado cash. |
| 0:55.7 | And specifically, we're looking at how different companies are handling them. |
| 0:59.8 | In the hours following the announcement, Jeremy Aller from Circle wrote a thread about his company's response. |
| 1:05.8 | Yesterday, U.S. Treasury designated for sanctions, ETH addresses associated with tornado cash. |
| 1:12.0 | As a U.S. regulated financial institutions subject to Bank Secrecy Act requirements, Circle, together with our partner |
| 1:16.5 | Coinbase, restricted the movements of U.S.D.C. funds in these sanctioned addresses. |
| 1:21.1 | It is likely that near all responsible registered virtual asset service providers also took |
| 1:25.1 | steps to block customers from transacting with these addresses or face charges of willfully avoiding U.S. sanctions compliance obligations, which can bring |
| 1:32.3 | up to 30 years in prison. The regulatory intervention in this case crossed a major threshold in |
| 1:37.2 | the history of the Internet and the history of open blockchain finance, with a major government |
| 1:41.2 | obliging parties to outright block or limit the functioning of open-source software on the internet. It raises extraordinary questions about privacy and |
| 1:48.4 | security on the internet and the future of public internet digital currency. We have noted |
| 1:52.7 | the tension between privacy and security as a policy matter. Yesterday, this stopped being an |
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