Cryptocurrency Exchange Coinbase will choose to quit staking Ethereum rather than censor the network to comply with US sanctions, CEO Brian Armstrong stated in a tweet.
Ethereum developer Lefteris Karapetsas asked Coinbase, Kraken, and other centralized exchanges on Twitter what they would do if the US government asked them to comply with sanctions and block transactions related to blacklisted Ethereum addresses.
This question has become a hot topic in the crypto community after sanctions were imposed on Tornado Cash, a cryptocurrency mixing service, last week.
Coinbase CEO Says They Can Quit Ethereum Staking Business If Sanctioned
Centralized exchanges are among the largest validators in Ethereum’s Proof of Stake (PoS) chain, which is currently in testing mode but will soon become the mainnet as the platform’s developers plan to abandon the current Proof of work (PoW) consensus mechanism.
Karapetsas had this to say in his Tweet to centralized exchanges:
“If regulators ask you to do protocol-level censorship on Ethereum with your validators:
A) Will you comply and censor at the protocol level?
B) Will you preserve network integrity by turning off the staking service?”
Three days later, Coinbase CEO Armstrong replied:
“This is an assumption that I hope we will not really encounter. But if we had met, I think we would have gone with B. We have to focus on the big picture. There may be a better option (C) or a legal challenge that can help us achieve a better outcome.”
It’s a hypothetical we hopefully won’t actually face. But if we did we’d go with B i think. Got to focus on the bigger picture. There may be some better option (C) or a legal challenge as well that could help reach a better outcome.
— Brian Armstrong – barmstrong.eth (@brian_armstrong) August 17, 2022
Armstrong also lent his support to Tornado Cash developer Alexey Pertsev, who was arrested in the Netherlands last week. The CEO of Coinbase tweeted, “No developer should be arrested for publishing open source software, even if it is used by malicious people.” he said.
*Not investment advice.
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