The RSS feed of my miningpool-observer project recently reported six OFAC-sanctioned transactions as missing from blocks. One of them didn't propagate to the pool yet, another was displaced by other transactions, however, the other four transactions were likely filtered by F2Pool. This is the first time I see a pool filtering OFAC-sanctioned transactions. It isn't clear to me why a pool from asia would be the first pool to comply with US sanctions.
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would advocating for miners to change their pool affiliation away from f2pool be warranted?
Miners should want to move anyways because F2Pool is forfeiting some of their revenue on their behalf.
many don't know any better without social pressure.
Nice detailed work. Appreciate it. Makes one wonder how transactions can be "missing" from the ledger that is supposed to be immutable ... Also, there is a whole bunch of shenanigans going on that we are just learning or discovering. One thing for sure I have learned in the last few years is that it is extremely hard if not impossible to really track a transaction. Say for example: spin the node, mine a block, shut down that node address forever, send it to exchange, run through Monero, send it back to a different address and totally different wallet VPNed to another country... Find me that transaction flow or try to link it to a person... :-) We are so early, lot of things to learn for sure.
The transactions aren't missing from the ledger/blockchain. I have the txids in the footnotes - feel free to look them up. They all have been mined, just not by the first pool that could have mined them.
They cannot.
In the 'censoring'/filtering case they just don't make it into the ledger.
Maybe a dumb question, but why don't these sanctioned individuals just use a different address?
Imagine:
1aaato1bbb1bbbnow has some corn.1bbb1bbbto1cccminers refuse to mine this transaction. Alice can choose other address to receive (ex1ddd), but the origin of the corn will be the same, the sanctioned address.Imagine if you could "burn" dirty coins as mining fees and the pool just returned you some fresh coins...
Oh wait, F2Pool already did that with Paxos/PayPal this year
I like to imagine some kingpin has been reusing the same address since 2013 and hasn't even noticed they're being sanctioned yet.
Fascinating article. I'm glad you're here providing us with this information.
Very interesting. Also, one mode reason to not reuse the same address.
So time to start using StratumV2 and braiins pool (previously Slush pool)
"A single pool filtering transactions does not affect the censorship resistance of the Bitcoin network as a whole." Pools can leave money on the table! That's ok. Other pools will pick it up.
But most puzzling about this is: "This raises the question of why F2Pool, a pool with origins in Asia, is the first pool to filter transactions based on US OFAC sanctions." Agree, this makes no sense. More to the story?
I’m going to go out on a limb and guess that f2pool is acting on behalf of US OFAC sanctions for Chinese diplomacy reasons. Xi was just in town, supposedly asking for lots of USD. This would be a low key way to fig leaf their way back into Biden’s heart. Maybe?
Really nice writeup, too. Lots of other cool content on your page, much to learn from it.
Time to get mining
Very interesting, we need to keep an eye on f2pool
Seems to be gone.
I think the game theory dictates that those who are sanctioned need to spin up their own hashrate, or start paying high miner fees to the willing.
If bitcoin is censor resistant, it still may require effort to get around sanction-loving actors like USG.
It's intriguing that F2Pool, an Asian pool, filters OFAC-sanctioned transactions. This move reflects potential alignment with global regulatory expectations or internal risk mitigation. Such actions could stem from a desire to maintain legitimacy or facilitate compliance with international norms. It's an interesting deviation from standard practices in the mining space, potentially signaling a shift in approach amid increasing regulatory scrutiny. Understanding their motives and implications is crucial in navigating evolving compliance landscapes within the cryptocurrency realm.
I think it was only a matter of time before this started happening. It's why decentralization is so important. One could imagine in the future there might be competing black lists; one from the West, one from China, one from some Islamic sect. This is fine as long as we have sufficient heterogeneity and some significant chunk of hash power that is maximizing for their economic interests over politics.
I don't know how to avoid the block chain. that's all
Very good information and I will continue investigating the page
f2pool was founded in 2013 and was the largest by 2014 with a third of the Bitcoin hashrate.