Recent developments were somewhat overshadowed by Trump’s inauguration and discussions surrounding a Strategic Bitcoin Reserve (SBR). However, developer b10c has brought attention to a recent study revealing that F2Pool, which commands approximately 11% of the Bitcoin network’s hash power, is actively censoring transactions sanctioned by OFAC…once again.
For those unfamiliar with the situation, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) maintains a register of sanctioned entities, including various Bitcoin addresses. U.S. law prohibits engagement in business with these sanctioned entities. It remains ambiguous whether this means that miners are barred from incorporating transactions to and from these addresses in the blocks they create; however, F2Pool appears to be taking a precautionary approach.
If F2Pool is the sole entity enforcing this policy, the issue may not be severe. While some transactions might experience delays of around ten minutes sporadically, the overall impact would be minimal.
Should additional mining pools begin to adopt similar practices, delays could become both longer and more frequent, though still manageable. Even a scenario where a majority of pools implement this policy may not yield catastrophic consequences.
The real concern emerges if most mining pools not only censor transactions but also refuse to build on blocks that contain these transactions. In such an event, those transactions could become entirely unconfirmable for as long as these mining pools maintain a majority status. This would effectively undermine Bitcoin’s characteristic censorship resistance.
While I can’t criticize F2Pool for its policy decision, I would prefer a scenario where no mining pools engage in censorship. Unfortunately, we find ourselves in a reality where even creators of open-source software risk imprisonment for facilitating unrestricted transactions for their users.
Instead of entertaining the notion of a Strategic Bitcoin Reserve, it would be far more beneficial if the incoming Trump administration took steps to cease state-sponsored attacks on Bitcoin.
This article represents a Take. The viewpoints expressed are solely those of the author and do not necessarily reflect the views of BTC Inc or Bitcoin Magazine.
