Coinbase is challenging the U.S. Treasury over the recent tornado cash sanctions

Crypto Coinbase has challenged the decision of the United States Treasury Department to include Tornado Cash, a decentralized software project, on the list of Specially Designated Nationals and Blocked Persons (SDN). This action, which was brought up in the Western District of Texas, marks a serious clash between the rapidly expanding cryptocurrency industry and the federal regulatory authorities.

Tornado Cash is a platform that runs on the Ethereum blockchain that offers immutable smart contracts that permit anonymous cryptocurrency transactions. This protects the users of Tornado Cash from having their privacy compromised. This piece of software has emerged as a central issue in the ongoing discussion on the appropriate level of government oversight of the digital space.

According to the allegations made in the complaint filed by Coinbase, the action taken by the Treasury Department to penalize Tornado Cash goes beyond the scope of the legal power granted to it under the International Emergency Economic Powers Act (IEEPA) and the North Korea Sanctions and Policy Enhancement Act. The plaintiffs contend that the usual definitions of a “national” or “person” do not apply to Tornado Cash since it is a decentralized organization, and these activities are governed by those definitions. In addition, they argue that the smart contracts in issue do not qualify as “property” in the legal sense since they cannot be changed and no one owns them. Furthermore, they claim that Tornado Cash does not have any legal, equitable, or beneficial stake in the smart contracts in question.

The judicial procedures shed light on the difficulty of governing blockchain technology and the ramifications it has for individual privacy and rights. The plaintiffs contend that the inclusion of Tornado Cash on the SDN List by the Treasury unfairly criminalizes the use of a privacy-focused software application, which impacts law-abiding persons. The plaintiffs have filed a lawsuit to challenge this designation.

As the case moves forward, it exemplifies the rising contradictions between the essential need for regulatory control in the bitcoin industry and the basic rights of free speech and privacy. The verdict in this case has the potential to establish an important precedent for the future regulation of cryptocurrencies as well as the wider use of economic penalties in the era of digital technology.

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Court Upholds OFAC’s Designation of Tornado Cash Under IEEPA

The United States District Court for the Northern District of Florida issued a decision concerning the designation of Tornado Cash by the Office of Foreign Assets Control (OFAC). The case, identified as Case 3:22-cv-20375-TKW-ZCB, revolved around the designation of Tornado Cash under the International Emergency Economic Powers Act (IEEPA). The IEEPA authorizes the president to declare national emergencies to handle unusual foreign threats to the United States’ national security, foreign policy, or economy. Utilizing this authority, the president had declared national emergencies concerning malicious foreign cyber-enabled activities and North Korea’s nuclear missile program.

Tornado Cash, a service utilizing smart contracts on the Ethereum blockchain to provide a degree of anonymity to transactions, was designated by OFAC on August 8, 2022, and later re-designated on November 8, 2022. This designation was challenged by the plaintiffs, who are users and a non-profit cryptocurrency advocacy organization. They argued that the designation of Tornado Cash’s core software tool exceeded OFAC’s statutory authority since it is mere computer code and no foreign entity has a legally recognized “property interest.” The designation listed 91 internet addresses affiliated with Tornado Cash, aiming to block and prohibit transactions through these addresses.

The Court’s decision upheld OFAC’s designation. It rejected the plaintiffs’ argument, stating that the operative language in the IEEPA is “any interest,” not “property interest” or “ownership interest.” According to the Court, Tornado Cash’s founders, developers, and Decentralized Autonomous Organization (DAO) have an indirect beneficial “interest” through the service’s usage, which increases the value of Tornado Cash’s governance token, TORN. The Court explained that an increased usage of Tornado Cash enhances the value of TORN, held by these entities, and thus establishes a financial “interest” for the purposes of the IEEPA.

Furthermore, the Court found that OFAC’s decision was not arbitrary or capricious and was adequately justified based on the foreign-affairs rationale, particularly given Tornado Cash’s involvement in laundering cryptocurrency for the benefit of the North Korean government. The Court also dismissed the plaintiffs’ First Amendment claims, stating the designation didn’t implicate Plaintiffs’ First Amendment rights as there are other privacy tools available for them.

In conclusion, the Court denied the plaintiffs’ motion for summary judgment and granted the defendants’ cross-motion for summary judgment, thereby upholding OFAC’s designation of Tornado Cash under the IEEPA. This judgment underscores the legal challenges faced by privacy-centric blockchain services in light of national security and foreign policy concerns.

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Immutable’s zkEVM Marches Towards Mainnet with a Series of Milestones

According to official Twitter account, Immutable has set the stage for gaming on the Ethereum blockchain with its recently launched zkEVM Testnet, accentuated by the involvement of @0xPolygonLabs. The progress is underscored by over 50 games that have earmarked their development on the Immutable zkEVM platform, showcasing a growing ecosystem even before its Mainnet launch.

The journey towards a fully functional Mainnet is highlighted by a series of methodical steps:

1. Testnet Launch (August): The initial phase saw the launch of the Immutable zkEVM Testnet which witnessed over 20,000 active addresses engaging in more than 100,000 transactions as developers started the groundwork for their gaming projects.

2. Testnet Re-Genesis (November): A significant transition was the re-genesis of the Testnet, upgrading the chain’s inaugural EVM client from Polygon Edge to Geth. This strategic move is aimed at aligning Immutable zkEVM closely with Ethereum, ensuring full compatibility with Ethereum’s extensive tooling ecosystem.

3. Mainnet Launch (December – January): The subsequent phase will unveil the Immutable zkEVM Mainnet, with an initial invitation to developers to explore the new chain in groups, prior to a public launch.

4. Dedicated App Chains (2024): Looking ahead, 2024 will see the introduction of dedicated app chains, offering a similar tech stack and capabilities as Immutable zkEVM but with distinct customization options. The transition to Geth is highlighted as a pivotal step towards ensuring optimal liquidity, accessibility, and security for each app chain.

5. Prover Integration (2024): A crucial milestone will be the incorporation of the zk-prover, embodying the essence of “zk” in zkEVM, and facilitating a trustless bridge between Ethereum and Immutable zkEVM.

Immutable’s vision is not just about creating a new blockchain but fostering a burgeoning ecosystem. The over 50 games committing to build on Immutable zkEVM is a testament to the platform’s potential to be the nexus of blockchain gaming on Ethereum.

Developers are urged to commence building on the live zkEVM Testnet to gear up for the upcoming Mainnet launch, as indicated on Immutable’s official developer portal.

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FTX Japan Launches Blockchain-based Proof of Solvency to Enhance Transparency and Security

In an effort to enhance transparency and bolster the trust of its customers, FTX Japan has unveiled a blockchain-based technology known as Proof of Solvency (PoS). This initiative was announced by Seth Melamed, the COO of FTX Japan, through a series of tweets on September 28, 2023. The newly introduced Proof of Solvency mechanism enables the company to prove, in an unalterable manner, that the reserves of the exchange surpass the assets held in custody for customers.

Proof of Solvency (PoS) is a method utilized to demonstrate a company’s capability to meet its long-term financial obligations, merging traditional financial audit practices with blockchain transparency. Highlighted by ICONOMI’s blockchain audit conducted by Deloitte on April 5, 2018, PoS comprises two core components: Proof of Liabilities and Proof of Reserves. Through the Merkle Tree approach, individual users can verify their account balances and overall liabilities without disclosing personal information, ensuring data integrity. Proof of Reserves entails disclosing total reserves encompassing digital and fiat assets, verified through blockchain addresses, bank, and exchange account information. Deloitte’s audit, covering 80 digital assets, confirmed ICONOMI’s $210.2M reserves surpassing its $133.6M liabilities, thus establishing its solvency. This PoS framework enhances transparency, security, and trust among stakeholders while maintaining user privacy.

The PoS is a significant stride towards addressing a central issue in the cryptocurrency market and, by extension, traditional financial markets. The technology aims to provide market participants, who have entrusted their assets to exchanges or financial institutions, with increased safety and information transparency. By doing so, it tackles the technical problem of information provision in a secured and transparent manner, which is a matter of concern for many in the industry.

FTX Japan has been ardently adhering to legal regulations by strictly managing the segregation of customer assets. However, with the introduction of PoS, the reliance on subjective verification or claims by the management has been replaced with cryptographic proofs such as Zero-Knowledge Proofs. These proofs and the corresponding results are reflected on the blockchain, thus allowing an objective verification of the asset management status by the customers of FTX Japan.

The PoS service is available to all customers of FTX Japan as well as the Liquid Japan platform. Customers can easily verify their balances with a mere three clicks via the Liquid GUI. Furthermore, details of the PoS are scheduled to be published weekly on the Ethereum blockchain, according to Melamed. This initiative is seen as a vital step towards resumption, and FTX Japan believes it to be a high-quality service for all participants in the cryptocurrency ecosystem.

The launch of the Proof of Solvency by FTX Japan underscores the growing importance of transparency and trust in the evolving digital asset marketplace. By leveraging blockchain technology, FTX Japan has established a robust mechanism to provide clear evidence of its financial solvency to its customers, thereby setting a positive precedent in the industry for security and transparency.

Disclaimer & Copyright Notice: The content of this article is for informational purposes only and is not intended as financial advice. Always consult with a professional before making any financial decisions. This material is the exclusive property of Blockchain.News. Unauthorized use, duplication, or distribution without express permission is prohibited. Proper credit and direction to the original content are required for any permitted use.

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Ethereum Testnet Successfully Upgrades for Upcoming Shanghai Hard Fork

The Ethereum community is eagerly awaiting the upcoming Shanghai hard fork, which is expected to take place on the mainnet in March. In preparation for this event, the Ethereum blockchain’s Sepolia testnet underwent a successful upgrade on February 28th. The upgrade, dubbed “Shapella”, was designed to simulate the upcoming fork and test its functionality.

One of the most significant changes in the Shapella upgrade is the ability for validators to withdraw their staked Ether (stETH) from the Beacon Chain back to the execution layer. Previously, validators needed to stake a minimum of 32 ETH to validate on the Ethereum blockchain. However, with this upgrade, validators will now be able to withdraw rewards in excess of 32 ETH and continue validating. Those who wish to fully withdraw their staked ETH can take all 32 ETH plus rewards and cease validating.

The successful implementation of the Shapella upgrade on the Sepolia testnet is an encouraging sign for the Ethereum community, as it indicates that the upcoming Shanghai hard fork will likely proceed smoothly on the mainnet. However, before the hard fork can go live on the mainnet, it must first be released on the Ethereum Goerli testnet.

The Goerli testnet is an important testing ground for Ethereum upgrades, as it allows developers to test new features and upgrades in a sandboxed environment before deploying them on the mainnet. The release of the Shapella upgrade on the Goerli testnet is expected to commence in March, giving developers ample time to test the upgrade and ensure its compatibility with the Ethereum ecosystem.

Overall, the successful upgrade of the Sepolia testnet for the upcoming Shanghai hard fork is a promising development for the Ethereum community. With this upgrade, validators will have more flexibility in managing their staked ETH, which will ultimately lead to a more efficient and secure network. As the Ethereum ecosystem continues to evolve and grow, the community can look forward to more exciting upgrades and developments in the future.


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What is Etherscan, and how does it work?

Etherscan is the most trusted tool for navigating through all the public data on the Ethereum blockchain and is sometimes called “Ethplorer.” This data includes transaction data, wallet addresses, smart contracts and much more. The application is self-contained and is neither sponsored nor administered by the Ethereum Foundation, which is a non-profit organization.

The team behind Etherscan includes seasoned developers and industry professionals, who developed the Etherscan app to make the Ethereum blockchain more accessible to everyday users.

Although Etherscan is a centralized platform, the app does make it easier for people to search through the Ethereum blockchain.

Is Etherscan a wallet?

Etherscan is not an Ethereum wallet, nor is it a wallet service provider. Users don’t receive an Etherscan wallet when they search the Ethereum blockchain on Etherscan. is an independent Ethereum-based block explorer. The Etherscan app keeps track of blockchain transactions on the Ethereum network. The app then displays the results like a search engine.

This allows users to find the details of transactions on the Ethereum blockchain, which may give someone peace of mind if their transferred funds have not yet appeared in their wallet.

While Etherscan can track the activity on an Ethereum wallet address, users will need to link the app to an existing crypto wallet to do so.

You may wonder — Is Etherscan free to use? Yes, Etherscan is completely free.

What is Etherscan used for?

Etherscan allows users to view the assets held on any public Ethereum wallet address. Using Etherscan, enter any Ethereum address into the search box to see the current balance and transaction history of the wallet under consideration. Etherscan will also display any gas fees and smart contracts involving that address.

Users can use Etherscan to:

  • Calculate Ethereum gas fees with the Etherscan gas tracker
  • Lookup and verify smart contracts
  • View the crypto assets held in or associated with a public wallet address
  • Observe live transactions taking place on the Ethereum blockchain
  • Lookup a single transaction made from any Ethereum wallet
  • Discover which smart contracts have a verified source code and security audit
  • Keep track of how many smart contracts a user has authorized with their wallet
  • Review and revoke access to a wallet for any decentralized applications (DApps)

Users can view any transaction of the Ethereum blockchain on Etherscan. These transactions include failed and pending transactions.

Etherscan can also keep track of the progress of an incoming transfer. One way to track a transaction using Etherscan is to look it up on using its hash key. The hash provides users with an estimate of how long the transaction will take to confirm. The page refreshes once the transaction is complete.

Etherscan also works as an analytics platform. Anyone can use Etherscan to analyze on-chain metrics like changes to Ether (ETH) gas costs, as well as keep track of their portfolio and monitor their transaction history for suspicious activity.

Only information that is public on the Ethereum blockchain is displayed on Etherscan, so information like a user’s private keys can’t be viewed on the app. Etherscan doesn’t store any private keys and is not involved in any of the transactions shown. The app also cannot be used to solve a transaction failure.

Do users need an account to use Etherscan?

Users are not required to sign up for an account before using the Etherscan app. However, signing up for an Etherscan account does give users access to additional features. These features include the ability to track addresses and receive notifications whenever a transaction occurs. Developers may also sign up to gain free access to Etherscan’s blockchain explorer data and application programming interfaces (APIs).

Thus, users with accounts can add their addresses to the “watch list” on the block explorer to monitor or track their investments. Users can also set alerts so that they’re notified of every incoming transaction via email. Etherscan also provides API services for developers so that they can create decentralized applications.

Etherscan provides the following information for all incoming and outgoing transactions:

  • Transaction hash
  • Number of blocks within which the transaction was recorded and the time at which the transaction was confirmed
  • Sender and receiver addresses
  • Gas fee
  • Amount sent
  • Total transaction fee

How does Etherscan work?

To use Etherscan, simply enter any public Ethereum wallet address into the search field at the top of the homepage. Doing so will allow users to view all the transactions associated with that address.

Viewing a transaction and wallet on Etherscan

Exploring a wallet address on Etherscan under the “Transactions” tab will show a list of all ETH transactions (Txns), or transactions that have used gas (Gwei) associated with that specific wallet.

Type the wallet address on Etherscan’s homepage and click “Search” to be redirected to a page that displays all of that wallet’s information. The data will include its ETH balance and its value denominated in United States dollar, as well as an overview of the wallet’s transaction history.

Click on the wallet’s Transactions tab, which will open up a new page displaying details on all the transactions involving that address. Details include the transaction ID, block height and when the transaction was confirmed.

The block height refers to the block in which the transaction was included. The sender and recipient addresses and the total transaction fee are shown as well.

To explore and track a single transaction, users will need the transaction hash or transaction ID, or TxHash. A TxHash is a unique string of numbers that identifies a transaction on the blockchain.

When users input the TxHash into the Etherscan search bar, a list of information on that transaction will be populated on the page. From here, users can go to the Transactions tab to review additional information about the said transaction. Such data includes whether the transaction status was successful, pending or failed, as well as the total amount that was transferred.

The value of the transaction in ETH, as well as the USD value of ETH at the time of the transaction, can also be viewed. Etherscan also displays the timestamp for each transaction in addition to the transaction cost, denominated in USD.

How to use the Etherscan gas tracker?

“Gas” refers to the transaction fee associated with a transaction to be executed successfully on the Ethereum blockchain. Transaction costs on Ethereum are referred to as gas fees.

Ethereum’s network can get highly congested. When a considerable amount of traffic is running on Ethereum’s blockchain due to Ethereum’s auction-based model, the average gas price goes up as users compete against one another and bid to have their transactions included in the next block. Consequently, transactions are delayed and some transactions fail.

Gas prices vary depending on the block that the user transaction has been included in, as well as the degree of network congestion. Moreover, users may not be able to discern an accurate estimate of the gas fees they’ll be required to pay before initiating a transaction.

To determine a transaction’s gas fees with accuracy, it’s best to use Etherscan’s gas tracker. Etherscan’s gas tracker does more than simply show users the difference in gas prices at various time intervals. It’s also useful for estimating how congested the network is and what the transaction cost will be per transaction.

The Etherscan gas tracker functions as an ETH gas calculator. It examines pending transactions on the Ethereum blockchain to determine how much gas a transaction will require.

Users receive a gas fee estimate so they can adjust the timing of their transactions to avoid high network traffic. Doing so saves transaction costs and allows for cheaper and smoother transactions, without suffering the anxiety that comes with not knowing whether a transaction will fail or succeed.

How to use Etherscan to check the wallet balance and history?

To see how the balance in a user’s wallet has changed over time, look up the address of the wallet on Etherscan and select “Analytics.” From here, users can see the data analytics of a user’s wallet, such as the user’s ETH balance, the entire transfer history, transactions and fees paid.

Using Etherscan to review smart contracts and wallet access

Smart contracts can be read and edited without the need for special permissions by using the Etherscan app’s “Read Contract” and “Write Contract” features. These tabs provide real-time information on various tokens and smart contracts. Users may also use these features to initiate a token transfer and approve smart contract transactions.

Removing a token’s access to the user’s wallet can be achieved using Etherscan’s Token Approval Checker. When users interact with DApps to buy or swap tokens, they tap directly into a user’s wallet with their permission. Therefore, DApps are an appealing target for scammers looking to gain access to users’ Ethereum wallet addresses.

If users see suspicious activity or believe that a DApp has been compromised, they can use Etherscan to revoke its access to a specific wallet address. The user’s assets inside the wallet will not be lost, but users will need to reauthorize the tokens when they access the DApp the next time around.

To use Etherscan to review a user’s approved token list, look up the user’s wallet address on Etherscan’s Token Approval Checker. Doing so will provide users with a list of all approved smart contract interactions with that wallet. From there, users can connect their wallet to Etherscan and click “revoke” to ensure that the specific DApp no longer has access to the user’s wallet.

The road ahead

Etherscan is one of the leading tools for accessing reliable Ethereum blockchain data. Etherscan can review smart contract code, track gas prices and monitor the Ethereum blockchain in real time.

Finally, Etherscan is free and doesn’t require a user to register to access all of its features. Overall, it’s a great place to start for users who would like to learn the full range of functionalities of a blockchain, as well as their Ethereum wallet and what information they can garner from a blockchain explorer.


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Ethereum whales dumping ETH as price slides below $4K, data shows

Ethereum is having difficulty keeping its richest investors in line as its native token Ether (ETH) hints at logging more losses in the near term.

Blockchain data analytics service Glassnode revealed that the number of Ether addresses that hold at least 1,000 ETH dropped to 6,292 this Monday, the lowest reading since April 2017. At its year-to-date peak, the numbers were 7,239 in January.

Number of Ethereum addresses with balance of at least 1K ETH. Source: Glassnode

On-chain analysts typically observe Ether distributions among addresses to realize retail and institutional sentiments. They consider wallets that hold above 1,000 ETH (around $3.92 million at currency exchange rates) as “whales,” primarily for their ability to influence interim market trends via large sell/buy orders.

But as the numbers of these so-called whales drop, it reflects an ongoing selling trend among the richest Ethereum wallet owners. For instance, the number of Ether addresses that hold at least 10,000 ETH (or around $39.20 million) has also plunged, from 1,208 in June to 1,156 at the time of this writing, marking an almost 4.5% decline.

Number of Ethereum addresses with balance of at least 10K ETH. Source: Glassnode

But, on a year-to-date timeframe, the numbers have gone up from 1,065 to 1,156, just as the cost to purchase one Ether, in the same period, has jumped nearly 450%. 

Small investors are accumulating

Unlike whales, wallets that hold Ethereum tokens in small quantities have been at the forefront of Ether’s 2021 price rally.

For example, Glassnode’s data shows that the number of Ether addresses with a non-zero ETH balance reached an all-time high of over 71.23 million on Monday. That included wallets with at least 0.01 ETH (~$40), whose numbers shot up to 20.31 million versus 10.66 million at the beginning of this year.

Meanwhile, addresses that hold at least 0.1 ETH (~$400) jumped to 6.44 million this Monday compared to 3.62 million on Jan. 1, 2021. That is almost a twofold rise, signaling a higher retail interest in the world’s second-largest cryptocurrency.

Number of Ethereum addresses with balance of at least 0.1 ETH. Source: Glassnode

ETH eyes bullish reversal

The latest decline in Ethereum whales appeared as Ether struggled to close decisively above $4,000, its psychological resistance level. 

On Tuesday, ETH/USD dropped by over 3.27% to an intraday low of $3,880. Its drop came as a part of a wider correction that started after Ether tested a downward sloping trendline as resistance on Dec. 23.

The chart below shows that the trendline is a part of a descending channel that appears like a “falling wedge.” 

ETH/USD daily price chart featuring Falling Wedge. Source: TradingView

In detail, falling wedges are technically bullish reversal patterns that appear after the price trends lower inside a trading range featuring two converging trendlines. The instrument in concern eventually breaks above the structure’s upper trendline ahead or after reaching the apex (where two trendlines converge).

The profit target in a rising wedge scenario is generally obtained after adding the maximum distance between the structure’s upper and lower trendline to the breakout point. That puts the ETH price en route to the $4,200-5,000 range, depending on its breakout level.

ETH/USD daily price chart featuring Falling Wedge targets. Source: TradingView

Nevertheless, Ether’s price still has enough room to decline, toward $3,200 in the worst-case scenario. The level is where Wedge’s trendlines converge.

Related: 3 reasons why Ethereum price can drop below $3K by the end of 2021

Meanwhile, independent market analyst Pentoshi says that nothing concrete can be predicted for Ether now as it remains stuck between a “bear contested” and a “bull contested” area, as shown in the chart below.

ETH/USD three-day price chart. Source: TradingView, Pentoshi

“Maybe it’s the bottom. Don’t care,” tweeted Pentoshi on Tuesday.

“I don’t like when them market gives this many times to buy an area with important historical context like this Would rather pay for confirmation.”

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Every investment and trading move involves risk, you should conduct your own research when making a decision.