Labrys’ Lachan Feeney on Ethereum validators compliance with US sanctions

Lachan Feeney, CEO, Labrys, a blockchain development agency, stated that around 45% of all Ethereum blocks which are currently being validated run MEV-Boost relay flashbots and follow United States-based sanctions, as reported by Cointelegraph.

According to Cointelegraph, through an interview, Feeney mentioned that while reports have shown that 25% of all blocks validated since the Merge happened comply with US sanctions, which is an indicator and the current number is expected to be closer for one out of every two blocks. Feeney highlighted that MEV-Boost are regulated business, mainly US-based, and are ensuring censorship of transactions particularly from Tornado Cash. 

On the basis of information by Cointelegraph, MEV-Boost relays are centralised platforms aimed towards Maximal Extractable Value (MEV) extraction. With Flashbots reportedly being popular, MEV-Boost relays help validators with outsourcing of block production and sell the right to build a block to the highest bidder. Labrys unveiled an MEV Watch tool recently to inform validators about compliance of MEV-Boost relays with Office of Foreign Assets Control (OFAC) sanctions.

“We’re just trying to raise some awareness for those who are unaware that by running this software, they are potentially contributing to censorship of the network,” Feeney said. 

Moreover, Cointelegraph noted that Feeney made the point of a worst case scenario referred to as hard censorship, where nodes would be enforced by regulation to discard blocks having these kind of transactions. Feeney even made the point that soft censorship could consume hours and require a high priority fee, resulting in sub-par user experience. Reportedly, the findings have been reinforced by Ethereum researcher Toni Wahrstatter, whose published research showed that of the 19,436 blocks supervised by the Flashbots Mev-Boost relay, none made the inclusion of a Tornado Cash transaction. Coby Moran, lead investigator, Merkle Science, a cryptocurrency compliance and forensic firm, recommended that the cost around being a validator could lead to the consolidation of validator nodes for certain cryptocurrency firms.

(With insights from Cointelegraph)

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