Tuesday, November 29, 2022

Users Criticize DeFi For Refusing To Provide Access Based On Wallet Content

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Decentralized Finance (DeFi) is one emerging sector in the crypto industry that has been in the limelight for a while. DeFi protocols offer users access to peer-to-peer digital exchanges, eliminating third-party involvement like banks.

The DeFi sector boycotts the charges and payments often requested by banks in running traditional finance transactions while maintaining a secure system. However, Brad Mills believes the purpose of Decentralized finance is defeated.

The Entrepreneur took to Twitter to express his disappointment with the network for denying users access to decentralized exchanges (DEXs). Mills lamented about the access denial of DeFi users on Ethereum due to location and wallet content.

He shared an image showing a pop-up message from 1inch Networks dApp denying access due to a restricted wallet address. He also said the future Web3 is a surveillance panopticon. Moreover, developers rebuilt all the faults of Wall Street on a blockchain.

DeFi Protocol 1inch Gives Reasons For Wallet Access Denial On Its DApp

1inch’s chief communications officer, Sergy Maslennikov, told reporters that wallet restriction is part of their strategy to ensure a safe and compliant community. The executive listed the category of wallets that the 1inch dApp restricts. These include wallets that engage in criminal activities, like terrorism financing, stolen funds, human trafficking, child sexual abuse materials, or sanctions.

According to Maslennikov, the decentralized finance aggregator complies with all sanctions and embargo lists applicable to DEX wallets. Furthermore, DEX complies with Anti-Money Laundry, terrorist financing prevention, and global community regulations.

FATF Adopts Tight Global Anti-Money Laundering Rule Enforcement Actions

Due to the rising cybercrimes, crypto-related fraud, and money laundering activities, the Financial Action Task Force (FATF) sprang into action. The watchdog said countries that do not follow the rules for crypto Anti-Money Laundering (AML) might enter its grey list.

The countries on the grey list would come under extensive scrutiny by the FATF. The FATF grey list is different from its blocklist. The latter is where the FATF enters countries like Iran and North Korea with significant strategic deficiencies relative to Money Laundering.

About twenty-three (23) countries, including the United Arab Emirates and the Philippines, are already on the FATF grey list. In addition, a recent report from Aljazeera says the FATF plans to conduct annual checks to ensure global AML and Counter-Terrorism Financing rules enforcement on crypto firms.

Meanwhile, due to ease in terrorism financing, the United Nations stated that terrorists prefer cash over crypto. The United Nations Countering Financing of Terrorism Coordinator, Svetlana Martynova, commented on this in a special meeting in New Delhi.

Martynova said that cash remains the predominant method for terrorist financing, but terrorists can adapt to new technologies, including crypto.

Users Criticize DeFi For Refusing To Provide Access Based On Wallet Content
Crypto market declines by 10% | Source: Crypto Total Market Cap on TradingView.com
Featured Image From Pixabay, Charts From Tradingview

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