ON-CHAIN CENSORSHIP ON ETHEREUM CONTINUES TO INCREASE

Concern around on-chain censorship on Ethereum continues to increase every day because many Ethereum blocks comply with the OFAC sanctions. These blocks do not contain transactions related to Tornado cash. If you don't know already Tornado cash is a privacy protocol that was sanctioned by the U.S department of treasury earlier this year. Right now, many Ethereum applications and services are now complying with OFAC sanctions which are leading concern that Ethereum validators would follow suit post-merge. With the current things, it looks like that is exactly what they are doing.

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According to the men watch tool, more than 55 percent of recent Ethereum carrying out the sanctions and that mean just 15% of Ethereum block were carrying out the sanction when the merge happened in mid-September. The creator of Ethereum Vitalik Buteran said that Ethereum validators that sensor blocks should be allowed whereas some months ago, he said that validators that sensor blocks should be divided. The logic is that a huge amount of ETH is being staked via centralized companies like Coinbase. This means that if Coinbase sensors Ethereum transactions it is Coinbase users that would suffer the slashing base on what the company did.

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This several worries about the on-chain sensor are making people think that the US regulators could begin introducing new regulations to Ethereum such as KYC. It will not be surprising if the US regulations required US users to complete the KYC to stake on Ethereum. It is not a good idea because you know some people have already staked their ETH and it will be locked until later 2023. It is a terrible thought to think that those that have already staked the ETH will require to complete their KYC before they could withdraw.

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There is a potential that US regulators will require stable coin issuers to collect KYC on every crypto wallet than is holding their tokens. You should that this could be introduced without on-chain censorship. The Shandong test net launch did not a significant effect on Ethereum and this means that Shanghai is going to be a very important upgrade. A lot of companies are much more comfortable investing in Ethereum and fidelity is one of them because they announced that they are going to start allowing their client investor into Ethereum. It will very bullish for Ethereum but it will go through some difficult processes.