Aave claims that the wallet monitoring protocols currently available are limited to its front-end application. DeFi’s lending protocol team stated that any escalation of smart contract levels will require a DAO voting.
Aave, a Decentralized Finance (DeFi), lending protocol, stated that wallet monitoring due to sanctions can’t be enforced at smart contract level unless it is agreed to by the community. The platform informed The Block.
Aave stated to The Block that the wallet monitoring is done only at the front-end layer. This was in reference to The Block’s new policy of screening users after the Tornado cash sanctions.
“As far as on-chain contract-level [wallet surveillance] in the Aave Protocol, Aave smart contracts can be decentralized. No one individual or entity can control, modify, update, or close down the protocol. AIPs must be submitted, voted on and approved by Aave DAO in order to make any changes to the protocol,” Aave stated in a statement to The Block.
AIP stands to Aave Improvement Proposals. AIPs are submitted for discussion to the Aave DAO governance. The protocol is overseen by the Aave DAO, a decentralized autonomous organization.
DeFi also clarified that the recent Block on wallet addresses for indirect Tornado Cash transactions occurred only on its front-end App.
A number of notable crypto personalities including Justin Sun and Anthony Sassano, founders of The Daily Gwei newsletter, reported that their wallet addresses had been blocked by Aave. Sun and Sassano were both notable public figures who had their wallets involved in an Tornado cash “dusting” incidentt in which someone sent 0.1 Ethereum to several well-known addresses. This was done in response to US Treasury sanctions on Tornado Cash.
Aave quickly remediated the situation after it became known that its platforms were blocking access for wallets that only have indirect interaction with the sanctioned cryptocurrency mixer. DeFi’s lender stated that the temporary blocklist was caused by a TRM API integration misconfiguration. TRM, a compliance solution used by many crypto companies, is . Aave claims it has fixed the problem and that its front-end should now be accessible to Tornado Cash users who have not previously been blocked.
Aave isn’t the first crypto app that blocks wallets from its front end. Uniswap, a decentralized exchange platform did this in April long before the Tornado Cash restrictions. Also, the sanctioned mixer was blocking addresses at its front-end.