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0 sats \ 1 reply \ @Se7enZ 5h \ parent \ on: Addressing compliance confusion wrt Tether and Taproot Assets bitcoin
As I understand it, they can't freeze funds on Liquid. Regulated assets with centralized control on Liquid are released as "AMP" assets, and Tether was not release as one of those. Between that, and confidential transactions, it is possible to track transfer of value through addresses between peg-in and peg-out, but you can't see which asset or how much of it are transferred.
USDT on Liquid is not subject to centralized control, but it's not completely untraceable via all heuristics.
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0 sats \ 0 replies \ @SwapMarket 5h
Exactly my point. But I think it can be completely untraceable given that a UTXO can confidentially hold BTC or USDT, and people can discretely swap BTC back and forth to LN. By the time some USDT amount shows up at a KYC exchange its history can be totally obfuscated.
One can also privately trade BTC/USDT via our non-KYC exchange.
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