Do we have autonomy over our own crypto assets? USDC Address Assets Are Freeze, Sparking Hot Discussions
Editor's Note: This article comes fromBlock beats BlockBeats (ID: BlockBeats), reprinted by Odaily with authorization.
Editor's Note: This article comes from
Block beats BlockBeats (ID: BlockBeats)
, reprinted by Odaily with authorization.
On July 8, Center, the issuer of the stablecoin USDC, has blacklisted an address at the request of US law enforcement agencies and frozen the assets of the address. After the news broke, one stone caused a thousand waves. Many big Vs and industry practitioners in the encryption circle have expressed concern about this.
Rhythm BlockBeats inquired that after the incident was exposed, Ethereum developer Philippe Castonguay made a DuneAnalytics page to display and track addresses that were blacklisted by USDC. Rhythm saw that according to the latest data on this page, 39 addresses have actually been listed as banned addresses.
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What is the Center Alliance
To understand USDC, you need to understand its issuer, the Center Alliance. The Center alliance is jointly invested, operated and initiated by Circle and Coinbase. The overall goal of the alliance is to develop the concept of stablecoins. It was created to create a blockchain-based infrastructure that would enable fiat currencies to operate on an open network.
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Why can Center freeze the USDC address on the Ethereum chain?
USDC is a stablecoin pegged to the US dollar, developed and regulated by the Center Consortium framework, and launched on the Coinbase platform on October 10, 2018. At the same time, USDC is also a product launched by the alliance.
So why can this alliance blacklist the USDC addresses on the Ethereum chain and freeze assets? According to Rhythm, this is because USDC has added a pre-agent contract in its token implementation. To put it simply, when we use the USDC contract to transfer funds, we access the USDC agent, and the agent then accesses the USDC target contract through the address set internally. To put it simply, the tokens you send will not be transferred directly to your target contract address, there will be a transfer station to obtain your target address first, and then the transfer station will transfer the funds to the final target contract address.
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The move sparked concern within the industry
The securities law expert and Compound’s general counsel said: The reason this is important is that the USDC blacklist (execution) assumption concerns have become real risks. The Center should now detail the criteria it uses when deciding when to blacklist an address. Was it compelled by court order or voluntary? Is there an appeals process? etc.
Linda Xie, former Coinbase product manager and co-founder of ScalarCapital, predicted that perhaps eventually, USDC and similar regulated centralized stablecoins will only be sent to whitelisted addresses that have been KYCed or pre-approved in some way. And maybe there will be an amount limit. She believes that the blacklisting of USDC addresses is inevitable and will happen in the future. USDC has never claimed to be a decentralized stablecoin. USDC is still valuable because of its transaction efficiency. Both centralized and decentralized stablecoins will coexist in DeFi.
Ethereum developer Eric Conner (Twitter name: eric.eth, focused on the impact of this matter on Defi: Everyone knows that USDC will blacklist an address at some point. Now it happens This matter is not a problem, but the fact that it is deeply rooted in many Defi protocols is a potential problem. Users should pay attention to hedging risks.
Rhythm observed that Yang Mindao, the founder of dForce, also holds a similar view. He said in the community that the freezing method of the USDC issuer actually has a great impact on DeFi. If the funds are not a separate account but mixed into the DeFi fund pool, So does the government still have to freeze the pool of funds? Based on this inference, will the DeFi protocol be affected by the closure of an account? He said that some stablecoin issuers are still very cautious about freezing contract addresses and whether they affect their partners, usually by freezing personal accounts.
DeFi watcher and analyst Chris Blec asks: Is this a criminal? Victim of fraud? Is it just because the government is investigating that it hasn't been convicted yet? We may never know. The only important point here is that USDC can freeze any USDC tokens on Ethereum at any time at its discretion.
Ryan Sean Adams, founder of cryptocurrency investment firm Mythos Capital and an Ethereum supporter, commented: "Bank stablecoins are not the moneyless money system we've been waiting for. That's why we need trustless economic bandwidth and a high ETH market cap .Our reserve assets must be unbanked, or we're just replicating the banking system we already have."
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