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The community of Ethereum has witnessed a split-up regarding the matter of the hazard dealing with the censorship of transactions on the protocol level amid the sanctions implemented by the authorities of the United States on the addresses associated with Tornado Cash.

During the previous week, the participants of the Ethereum community have suggested a user-activated soft fork (UASF) or social slashing be the probable measures for Ethereum’s censorship at the transaction level. However, a few categorized it as a trick that would cause more disadvantages rather than benefits. And the rest of them considered it inevitable for the provision of censorship resistance and credible neutrality-related elements on Ethereum.

Ethereum Community Gets Divided over Transaction Censorship Solutions

This mounting argument is witnessed following the Ethermine (the mining protocol on Ethereum Network) determined not to process the transfers carried out via Tornado Cash – a privacy instrument that is based on Ethereum and has been sanctioned by the U.S. authorities. This decision has raised apprehension among the Ethereum community’s participants regarding the possible outcome if the rest of the centralized validators would additionally do the same.

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Along with this, the community is discussing the efficiency of the network’s social slashing confronting the censorship, as this method could pave the way toward a chain split because a few validators would be processing transfers on-chain without any censorship while the rest of them would be validating just the chain that complies with OFAC.

Social slashing is considered to be a procedure in which a particular percentage of the validators’ stake is slashed in the case of not correctly validating the transfers or else performing dishonestly. This may turn into a big matter if the regulators demand prominent centralized staking services such as Coinbase as well as other well-known centralized pools.

A Few Community Members Oppose Social Slashing

These platforms cumulatively stake almost 50% of the funds in ETH under the chain named Ethereum Beacon 2.0 for only the validation of OFAC-compliant chains. Justin Bons, Cyber Capital’s founder, debates that slashing would work as a trap.

It will pose a huge hazard instead of the regulation of the OFAC and would not provide a feasible solution to deal with censorship at the scale of the overall protocol. On Monday, a lengthy Twitter thread was posted by Bons in which he mentioned that with the social slashing against the exchanges, numerous innocent consumers will lose their deposits and this would be against their property rights.

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Nathan Ferguson

By Nathan Ferguson

Nathan Ferguson is a talented crypto analyst and writer at Herald Sheets, dedicated to delivering comprehensive news and insights on the ever-evolving digital currency landscape. With a strong background in finance and technology, Nathan's expertise shines through in his well-researched articles and thought-provoking analysis. He holds a degree in Economics from the University of Chicago, and his passion for cryptocurrency drives him to stay up-to-date with the latest industry trends and developments.