ZkSNACKs, the developer of Wasabi Wallet, blocks US users, sparking speculation in the crypto community linked to Samourai Wallet’s founders’ arrest.
ZkSNACKs, the developer of the privacy-preserving Bitcoin wallet Wasabi Wallet, has declared that access to its products and platforms will be denied to users from the United States until further notice.
In the crypto community, this action has generated intriguing debates and conjecture, with many attributing it to the recent arrest of the founders of Samourai Wallet.
In a blog post published on Saturday, April 27, zkSNACKs disclosed that individuals who are citizens or permanent residents of the United States will be permanently prohibited from accessing its websites and utilizing the Wasabi Wallet. The software company will also deactivate additional products and services, including RPC interfaces and APIs.
The statement read:
“U.S.” refers to “United States” and includes the several states of the United States and related territories. If you are a United States Citizen or United States Resident, you are not allowed to visit any sites aforementioned, download Wasabi Wallet or use the Wasabi Wallet coinjoin feature. This includes if you are a U.S. permanent resident or if you are an individual that holds a U.S. passport.
zkSNACKs cited “recent announcements” by US authorities in the blog post as the primary rationale for this determination. It is difficult to determine which specific announcement the company was alluding to.
However, the recent arrest of the proprietors of the privacy-focused Samourai Wallet is believed to have prompted their withdrawal from the US markets.
US law enforcement detained Keonne Rodriguez and William Lonergan Hill, co-founders of Samourai Wallet. They were arrested on suspicion of operating an unauthorized money-transmitting enterprise and conspiring to launder money.
Both individuals were indicted on charges of aiding in the laundering of illicit proceeds exceeding $100 million, which comprised funds sourced from the Silk Road and Hydra Market.
In recent weeks, regulatory scrutiny from the United States Securities and Exchange Commission (SEC) has also been witnessed towards Consensys, the developer of the MetaMask wallet. The financial oversight body focuses on particular wallet functionalities within MetaMask, including the exchange and staking capabilities.
Recent reports indicate that Phoenix Wallet, an ACINQ product, will exit the United States market next month. The wallet provider instructed users in the United States to drain their wallets and eliminate their assets prior to May 3, 2023.
ACINQ wrote in a post on X:
Recent announcements from US authorities cast a doubt on whether self-custodial wallet providers, Lightning service providers, or even Lightning nodes could be considered Money Services Businesses and be regulated as such.
The departure of these self-custody cryptocurrency wallets and initiatives from the United States underscores the regulatory complexities and volatility that engulf the cryptocurrency sector and technologies that augment privacy.
