Tornado Cash ban could spell disaster for other privacy protocols Manta co-founder

There are growing concerns that the recent US government sanctions against Tornado Cash could become a “slippery slope” for Web3 privacy, ultimately rendering the entire space “meaningless.”

Speaking to Cointelegraph, Shumo Chu, co-founder of the Manta Network of privacy protocols, said harsh sanctions against Tornado Cash could have ripple effects on all Web3 protocols, including those that provide privacy. expressed concern.

Chu is one of the co-founders of the Polkadot-based Manta Network. The Manta Network is a layer 1 privacy protocol that allows private transactions. Decentralized Finance (DeFi).

Tornado Cash (TORN) Ethereum (ETH) A privacy protocol that anonymizes coin transactions. These protocols are similar to Monero (XMR) and zcash (zek) masks the sender and receiver data of cryptographic transactions.

Earlier this month, the U.S. Treasury Department Effectively Bans US Residents Place 44 from protocol usage ethereum and US dollar coin (USDC) addresses associated with it on the list of Specially Designated Nationals on August 5th.

Chu expressed concern that other privacy protocols like his might fall into the same crosshairs. This adds censorship to the point that “the whole Web3 space is essentially pointless”.

Chu admitted that the US government’s ban was ostensibly in the interest of national security, as the North Korean hacker group Lazarus is known. wash with a tornado The funds it steals.

But in banning the protocol, Chu questioned regulators’ understanding of how decentralized systems based on open source code could be deployed and operated anywhere.

It is quite possible that regulators do not understand decentralized blockchain technology and how open source code is everywhere. [They] In fact, they may have thought that the Tornado Cash developers intentionally aided North Korean hackers.

Last week, Dutch police Tornado Cash developer arrested They suspect they are involved in money laundering.

Chu added that there have been cases of arrests of crypto developers in the past. Ethereum Developer Virgil Griffithsbut banning protocols is a “new paradigm”, indicating that the government is seeking to control code and mathematics itself.

They are banning the protocol on behalf of some people. Basically, this is the code for the Ethereum blockchain.

But Chu believes that ultimately privacy protocol developers will have the upper hand. He said privacy developers are scattered across many jurisdictions beyond the reach of the U.S. government.

If the US tries to take tough action against privacy developers, it will not work.

As the developer of the privacy protocol, Chu points out that the theory is set that privacy is only for the bad guys, claiming that “regular people use it too.”

Related: Tornado Cash Shows DeFi Can’t Escape Regulation

There is also a push to promote good use cases, he added, because, as he said, “the nature of the system is permissionless, there will be people who abuse it.” .

His view aligns with that of Kraken CEO Jesse Powell. bloomberg In a television program on August 16, he said the sanctions against Tornado were “unconstitutional” and that “people have a right to financial privacy.”

In Chu’s eyes, the barriers to entry for privacy protocols should be low enough for ordinary people to use them on a daily basis. But his ideals could be threatened by further sanctions of privacy protocols.