Why Justin Sun was blocked from this Ethereum DeFi protocol

Diplomat and founder of the TRON network, Justin Sun, confirmed that one of his addresses was blocked from using the Ethereum decentralize finance (DeFi) protocol Aave. Via Twitter, Sun claimed that he received 0.1 ETH from Tornado Cash which caused his address to be added and blocked by the protocol.

Justin Sun was just one of many well-known personalities in the crypto industry, and beyond, to receive funds from Tornado Cash. Over the past week, high-profile individuals have been sent funds from the Ethereum decentralized exchange following the sanctions imposed by the US Treasury Department.

Justin Sun, Ethereum educator Anthony Sassano, Coinbase CEO Brian Armstrong, NBA legend Shaquille O’Neal and TV personality Jimmy Fallon received 0.1 ETH apparently as a form of protest against the sanctions. The actions taken by the US Treasury Department have set a dangerous precedent, according to privacy, crypto and technology advocates.

As Bitcoinist reported, Tornado Cash was added to the Foreign Assets Control (OFAC) Specially Designated Nationals And Blocked Person List (SDN). A mechanism used to punish terrorists and other dangerous individuals, not tools or technologies, as stated by Jerry Brito, CEO of Coin Center.

Aave and other Ethereum DeFi protocols implemented a mechanism to block certain addresses from interacting with their platforms. The mechanism was created in collaboration with compliance firm TRM Labs to block out entities suspected of violating the US-imposed economic sanctions.

Year Finance core developer “Banteg” shared a timestamp list with more data about when these protocols implemented their “address screening feature,” a tool many consider a violation of user privacy. The list consists of decentralized exchange Uniswap, lending protocol Balancer, Aave and others.

Justin Sun so the following when he found out that his address was blocked from the Ethereum DeFi protocol:

Sending Tornado Cash eth to Jimmy Fallon, Brian Armstrong, Paul Logan, Shaquille O’Neal is fine since none of them use defi application. But don’t send it to me (…).

Justin Sun’s Aave Lockout Highlights Treasury’s ‘Clumsy Approach to Tornado Cash’?

At the time of writing, there are reports of Aaave and other protocols updating their websites to unblock Justin Sun and other affected individuals. Anthony Sassano confirmed this via his Twitter handle:

I didn’t contact the Aave team and ask them to unblock me – all I did was post my original tweet as a social signal to make people aware that this was happening. I believe the cancellation applies to anyone who was dusted with 0.1 ETH from Tornado Cash (TC) the other day.

As mentioned, Coin Center is not the only organization expressing concern about the sanctions. In a press release, the non-profit organization that defends the digital rights of private citizens “Fight For The Future” classified the sanction as “awkward”.

Furthermore, the non-profit organization claims that the Treasury has engaged in an act of censorship against Tornado Cash and its developers. The press release claims:

Let’s be clear, hackers and cybercriminals, as well as those who support them, are deplorable and should be stopped—but not in a way that compromises human rights and the First Amendment.

Fight For The Future predicts a dark possibility for similar projects, as they believe the sanctions against Tornado Cash could act as “a warning shot” for those creating privacy tools based on cryptocurrencies. In this sense, they believe that the sanctions can be interpreted as an attack on the US’s first amendment: freedom of speech.

Fight For The Future said: Tornado Cash is code, and Treasury sanctioned code. The organization understands code as a form of speech, making the sanctions a direct attack on that right.

ETH’s price is coming into strong resistance on the 4-hour chart. Source: ETHUSDT on Tradingview

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