Legal Guidance for US Ethereum Stakers re: OFAC Compliance

StableRare
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Legal Guidance for US Ethereum Stakers re: OFAC Compliance

Is there any legal guidance available for US solo staking validators needing to censor OFAC blacklisted Ethereum addresses? My understanding is there is no way to do this in the default vanilla configuration. Instead, you would need to use third-party software by flashbots called mev-boost and then select relayers that state they will be censoring OFAC blacklisted addresses.

I am unable to find much in the way of formal legal guidance re: this obligation. There is some factual evidence for US based validators not needing to censor OFAC transaction, but they are all circumstantial. Such evidence includes:

  1. Few, if any, Bitcoin miners currently censor OFAC transactions
  2. Ethereum miners prior to POS mostly did not censor OFAC transactions. The only exception to this was Ethermine and they did not start censoring OFAC transactions until after Tornado Cash was added a few weeks prior to the merge. There is no indication they censored before Tornado Cash was added to the OFAC list.
  3. Even now, many large US -based validators are running vanilla configuration without censoring such as Coinbase, Kraken and Staked.us. Persumably, they would not do so if they thought this was against OFAC regulations.

I am wondering if anyone has any access to any real legal analysis in this regard. My concern would be Treasury (OFAC is a dept of the treasury) would be more likely to target solo validators, to make an example out of them, since they would not have the resoucres to defend themselves than a large exchange or other centralized entity such as Coinbase or Kraken. Then they could use any settlement or conviction as precedent to then go after the larger centralized actors.