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Navigating Sanctions in DeFi

This chapter explores the implications of smart contract sanctioning, particularly focusing on Tornado Cash's addition to the OFAC sanctions list. It examines the chilling effects of these regulations on the cryptocurrency ecosystem, highlighting instances of censorship by platforms like Aave and DYDX. The discussion also considers potential community-driven responses, such as social slashing and user-activated soft forks, emphasizing the importance of maintaining censorship resistance within decentralized finance.

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