I’m pretty new here I don’t expect my words to carry much gravitas. That being said, from my perspective banning degenbox is completely counter to what this defi movement stands for.
I understand that there are some shady actors and circumstances surrounding abracadabra which are very clearly outlined in the recent poll to ban it. But, from what I gather abracadabra degenbox is a legitimate–albeit creative–utilization of anchor protocol.
Banning its use simply because it has unintended negative impacts seems like a bad decision mostly because of the precedent it sets for dealing with future similar situations. If the anchor protocol cant handle/adapt to novel utilizations, that seems to speak more about the current design of the system and may be an indication of longer-term issues.
Please correct my thinking if I’m looking at this incorrectly.
There needs to be a positive precedent set. If Anchor is allowed to be a drug money washing operation, it will be criminalized or banned and will die a slow and painful death. It’s literally life and death (of Anchor) here. It’s an existential choice: will Anchor be clean and reputable (ban MIM/abracadabra and any future abuse) or will it be a ponzu scheme and drug and criminal cartel money laundering front (by allowing such unsavory operations on it). What happens will decide the future of Anchor. And even if there is a long term future for it.
If someone really wants to launder money, how are you going to prevent it? Do you want to build a perfect system in which such a state is prohibited? Good luck.
For years, Swiss/off shore banks were at the forefront of such operations, and they still predominantly are. Is their reputation at stake today? Are people pointing fingers at Swiss banks?
The thing is, you have no clue what transactions those banks are processing, while in the blockchain world, everything is public.
I think that, in order for the technology to succeed, we as a community need to become more objective and data driven, rather than emotional, as otherwise we risk driving the technology into the ground by engineering unfeasible/lossy prevention systems.
Go to your local bank, deposit there and be happy with it, they do KYC and AML so that probably limits the drug money somewhat. This feels like Bitcoin circa 2012 all over again, “it’s only used for drugs!!!”, “it will be banned and regulated to oblivion!!!”… Governments can force nodes out of local cloud providers, they can regulate on and off ramps, but they can’t stop people from using the protocol.
You wanted to ban MIM because it was predatory, now it’s because Danielle is a drug baron money launderer (you should watch Ozark, you’ll love it). Can’t wait to see who’ll be next on the ban wishlist, perhaps I can help, Mirror allows looping too.
Yes. They’ve been fined astronomical sums. Some have even come close to losing access to the US dollar banking system. They’ve had to get down on their knees and beg the US regulators to take their 100s of millions or Billions of fines and let them keep conducting business. And in case you are not aware, every US person with any non-US accounts of any type has to file the FinCEN FBAR form each year.
Do we want crypto to fall under the same regulations, FBAR-like filing requirements of every crypto account address and maximum balance each year, and the same constant finger-pointing that there is towards Swiss banks? I, for one, don’t. If Anchor and Terra can keep its nose clean and be wary of whom it befriends and endorses, it’ll save a lot of grief (and risk) for all of its users in the long run. You don’t seem to understand the implications of FBAR-like reporting for US persons of crypto, which would then likely fall under the FinCEN system, where each and every wallet and address must be disclosed and will be reviewed by the government. Swiss (and other foreign) bank actions brought that on for the banking system. Now actions of those who don’t know any better and only think of short-term price pumps vs. long-term sustainability are in the process of bringing that on for crypto.
And as for banks, every transaction over $10,000 had to be reported. Now every transaction over $600 has to be reported to the government, by traditional banks and fin techs - everyone. Same regulations are likely to come for crypto. If you can’t determine who is a US person (in crypto you can’t), then there may be a law that every crypto protocol which is accessible to US persons (so unless you can do really good geo-blocking, that will be essentially every crypto) must have a reporting backdoor built-in, where every transaction (over $600, if same standard is used) must be reported to the government. Again, it seems like you really don’t know the banking laws and regulations and are not even familiar with the very common SAR form that each and every bank files countless copies of for too-many-to-count transactions each and every day with the US OCC. The equivalent of SAR filed with the OCC is not feasible in crypto, so it’s likely to come down to reporting each and every transaction worth over a few $100s to the government by the crypto chain/protocol, along with FBAR-like reporting by all US persons of each and every crypto address/wallet they have. That is a worst case, but realistic - and in fact likely - scenario.
The US government beat you to it. A subpoena from the SEC was served to Kwon last year. He and TFL cut all ties to Mirror as a way to try to get out of it, or at least further liability. But too little too late.