Bitcoin Mining Pool F2pool Acknowledges OFAC Transaction Censorship; Backpedals After Community Backlash

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F2Pool, a Bitcoin mining pool, has admitted to filtering transactions coming from Bitcoin addresses flagged by the Office of Foreign Assets Control (OFAC). After the situation was discovered by 0xB10C, a Bitcoin developer, F2pool co-founder Chun Wang acknowledged that his pool was indeed applying this filter, announcing it would drop the censorship until there was consensus in the community on the issue.

F2pool Acknowledges Compliance With OFAC Sanctions

F2pool, one of the largest Bitcoin mining pools in the world, acknowledged having been filtering transactions coming from addresses flagged by the Office of Foreign Assets Control (OFAC). Chun Wang, a co-founder of the pool, admitted applying a compliance filter for these transactions after 0xB10C, a Bitcoin developer, published an article that examined different transactions to determine if they were intentionally filtered or if there were other explanations for this behavior.

The investigation, which examined six different transactions coming from OFAC-flagged addresses, pointed out that the four transactions excluded by F2pool were likely filtered. Nonetheless, the two remaining transactions could have been excluded due to other reasons. 0xB10C stated:

These four missing sanctioned transactions lead to the conclusion that F2pool is currently filtering transactions.

Wang Doubles Down, Backpedals Later

Wang answered a post made by 0xB10C in X, explaining the reasons that led F2pool to apply this OFAC transaction compliance filter. In a now-deleted post, Wang stated:

Why do you feel surprised when I refuse to confirm transactions for those criminals, dictators and terrorists? I have every right not to confirm any transactions from Vladimir Putin and Xi Jinping, don’t I? Meanwhile, CZ is selling his soul for money. He deserves.

Furthermore, Wang pointed out that a “censorship resistance system” had to be designed to resist censorship from its protocol design instead of depending on each participant to decide not to censor. He explained that Bitcoin should learn about the mistakes on the internet in this regard.

This posture resulted in backlash from the community, with several X users explaining that the hashrate in F2pool was not owned by the administrator of the pool, accusing Wang of imposing his values on other people.

F2pool finally backpedaled (in another since-deleted post) on the issue, announcing it would stop filtering these transactions. Wang declared:

Will disable the tx filtering patch for now, until the community reaches a more comprehensive consensus on this topic.

What do you think about F2pool’s OFAC-compliant transaction filtering initiative? Tell us in the comments section below.