51% of Ethereum blocks are now compliant with OFAC standards, raising censorship concerns

According to data from blockchain development Labrys, 51% of Ethereum blocks had been compliant with OFAC standards one month after the Merge. This is a result of MEV-Boost relays taking over market share.

Users on Twitter highlighted the fact that these figures are a significant step towards censorship as more blocks are being monitored:

Another sad milestone in censorship was reached: 51%. This means that if the censoring validateators stopped attesting to noncensoring blocks, they would eventually form the canonical 100% censoring chain. pic.twitter.com/JrYUjowLpt
— Martin Koppelmann (@koeppelmann) October 14, 2022

OFAC stands to represent the Office of Foreign Assets Control. This is the US entity responsible for enforcing economic sanctions. MEV-Boost relays, centralized entities acting as trusted mediators, are able to connect block producers and builders. All Ethereum proof-of–stake (PoS), validators, can outsource their block construction to other builders.

This metric shows how many blocks have been built since the Merge by OFAC-compliant MEVBoost relays. MEV-Boost was able to provide a more representative distribution for block proposers than a small number of miners who are proof-of-work (PoW) after Ethereum upgraded to a PoS consensus.

Ethereum blocks increased from 9% to 51% OFAC-compliant over the past month as mev boost (block outsourcing) gains market share. https://t.co/SYiVHPlTf4
— Lyn Alden (@LynAldenContact) October 14, 2022

Labrys CEO Lachan Feeney spoke to Cointelegraph September and stated that, in the event of hard censorship, it would mean that no matter how long you waited or how much you paid for, the sanctioned transactions would not be included in the blockchain.

In a strict censorship scenario, “nodes” would be required by regulation to discard all blocks that have any of these transactions.

He also pointed out that, even with soft censorship when approved transactions are eventually validated, it would likely lead to long waits, high-priority charges, and a substandard user experience.

Labrys’ webpage states that there are seven major MEV-oost relays currently in operation. These include BloXroute Max Profit and BloXroute Ethical. BloXroute Regulated, BloXroute BlockNative, Manifold, Eden, BloXroute Regulated and BloXroute Regulated. Of the seven major relays available, only three do not censor in accordance with OFAC compliance requirements. The company stated that OFAC-compliant relays won’t include transactions that interact with Tornado Cash smart contracts or other sanctioned wallet addresses, as defined by OFAC.”


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