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Original author:0xSoros
Tornado Cash was supervised, and the founder’s Github account, project code base, website domain name, USDC contract, and RPC service (originally provided by Alchemy and Infura) were fully banned. This article is a partial summary (Mindao teacher part) and reflections on the discussion on this incident on A&T Capital's Twitter Space last night.
It should be confronted head-on from the legislative and regulatory level, not just from the Crypto level. Decentralize Infra. A certain subdivision of the industry is often regulated and claimed to be decentralized, which is more like a slightly old-fashioned narrative method. Indiscriminately assigning a decentralized name to things in the traditional field is the thinking inertia of the entire industry.
For example, BTC was a decentralized digital gold in the early days, while ETH was a decentralized global computer. The early narratives were rough, and the important thing is to explore the meaning. Looking back at them, many of them have already changed beyond recognition. Mr. Ming Dao’s idea of confronting it head-on is from a strategic position, while the idea of decentralization of Crypto players is a bit self-contained.
Crypto native players use apps like Tornado Cash more for privacy needs than for coin laundering. For example, cautious and experienced whales regularly change their wallet addresses through Tornado Cash every month. VB has also publicly praised it many times and often uses it for transfers. Why use Tornado Cash to transfer money?
The spirit advocated by Crypto during its genesis has made transfers private. Only when the privacy of BTC is lacking and unsatisfactory have there been attempts at privacy coins such as Monero and Zcash. In other words, many usage scenarios of Crypto are for privacy rather than illegal behavior.
To take a step back, the project party/hackers colluded with the exchange to operate in a black box, and the exchange is truly the best place for laundering coins. Blocking a decentralized application with a small use case for coin laundering, and the exchange has done a lot of evil for several years but has been safe and sound, may be the eternal curse of this industry.
The trees are beautiful in the forest, but the wind will destroy them. The leading effect of Tornado Cash is strong, and there are many copy versions of Tornado Cash on multiple chains, but for security reasons, users will only choose Tornado Cash on Ethereum. Orthodoxy is strong. And every time hackers steal coins, they will use it to launder coins and repeatedly advertise for free, making regulators feel that the existence of this app is to do evil. Blocking is also reasonable.
The delisting of Zcash and Monero from mainstream exchanges is also a regulatory factor. However, the regulators didn’t understand it first. In fact, it is useless to supervise multi-chain money laundering and ban Tornado Cash. Through operations similar to composability, funds are transferred in multiple chains (supplemented by tools such as cross-chain bridges), which can't be blocked even if you want to.
The solution provided by Mr. Mindao is to let the privacy service sink to a common protocol layer. Turning financial services into information shuffling services and gradually diluting their financial attributes is similar to a means of whitewashing.
Generally speaking, the privacy needs of the Crypto industry have been suppressed. Whether players don't pay attention to privacy at all, or there are not enough privacy tools for us to protect our privacy, this can only be judged after the industry's privacy applications are rich enough and resistant to censorship.
Having said that, decentralized infrastructure is indeed a constant narrative in the industry. Today, most of the facilities in the industry are still centralized. We only ensure the decentralization of the bottom-level consensus of BTC/ETH (through miners and nodes). Tornado Cash is exposed in the codebase, domain name, Contracts, RPC services and other links need to be further explored in decentralization.
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