The founder of layer-one blockchain Jurat has defended his protocol against would-be haters, arguing that on-chain legal enforcement is a necessary trade-off for cryptocurrency mass adoption.
August 8, U.S. District Court used Jurat’s on-chain enforcement tool locked several sanctioned individuals out of their crypto accounts. The men have been sanctioned for money laundering and using ransomware to extort cryptocurrency payments to benefit North Korea’s weapons program.
A court just delivered its final judgment in a federal lawsuit, and the court used @JuratNetwork Execute its order on-chain!
Judge bans Russian and North Korean hackers from accessing their accounts $JTC The first cryptocurrency to comply @USTreasury…
— Mike Kanovitz (@MikeKanovitz) August 8, 2023
Speaking to Cointelegraph, Jurat founder and CEO Mike Kanovitz said the judicial order is the first of its kind.
The Jurat blockchain will launch at the end of 2022 through a fork of the Bitcoin blockchain. The technology connects blockchain nodes with court cases to enforce court orders.
Kanovitz acknowledged that such technologies may draw criticism from die-hard supporters of decentralization.
“Some people will claim to be philosophical purists and hate it. I get it.”
However, the Illinois attorney said such technologies could bring necessary due process protections to digital assets, which would be key to mainstream adoption.
“Some people who currently believe that there shouldn’t be effective law enforcement on-chain feel differently if they get hacked, scammed, or lose their private keys. Then they breathe a sigh of relief because they can get their property back,” he said explained
Cryptocurrencies worth $656 million in the first half of 2023 According to a June 30 report from blockchain security firm Beosin, the company has suffered losses due to scams, hacks and pulls.
Web3 security statistics for the first half of 2023
Total losses due to hacking, phishing scams and scams in Web3 reached $655.61 million in the first half of 2023.
Among them,
108 attacks -> $471.43M
Phishing scam -> $108 million
110 rug handles -> $75.87M pic.twitter.com/8Q9kmDETfQ— Beosin Alert (@BeosinAlert) June 30, 2023
“Not only would this curb the lawlessness that scares away adoptees and angers government officials, but it could unleash incredible commercial utility,” he added.
related: MetaCourt Launches IDO: Web3 Legal Services Paradigm Shift
So far, courts have had limited means to effectively freeze and seize crypto funds. A common tactic is to order centralized cryptocurrency exchanges to freeze funds or hand over suspect identities.
However, the on-chain enforcement tool works by connecting JTC’s blockchain and software nodes with courts of the user’s choice.
During litigation, each party provides the court with a competing hash that expresses what that party wants the court to do. When a ruling is made, the court simply pastes the hash of the winning party, and the software node automatically executes the order once it has access to the online court records.
Kanovitz said the tool currently only works in the U.S. and only on the JCT blockchain. However, he hopes to introduce JCT’s technology to other EVM-compatible blockchains in the future.
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