Metamask, one of the leading names in the crypto space, recently decided to block Iranian and Venezuelan IPs and users “due to legal compliance”.
This decision was met with stark criticism from crypto enthusiasts because, in theory, crypto is supposed to be decentralised and immune to geo-political censorship and dynamics.
MetaMask is a self-custodial crypto wallet – it means you can store your crypto online and only you own the password (commonly called ‘private keys’) to your wallet – but it is also part of a registered software company called ConsenSys.
In short: MetaMask had to comply with sanctions involving Iran and Venezuela because its parent company had to.
The move has also fuelled the fiery debate over decentralised finance, because while MetaMask could indeed restrict access in certain regions, the company can’t gain access to users’ funds as these are protected by the private keys that only users have access to… It means that if you lose your password, no one can retrieve them for you, not even MetaMask.
This basically means users can’t transact or freely use their Metamask wallets, but they can retrieve funds and move them out of their online wallet, a process which could be sped up and made easier using a VPN.
Some people assume that crypto can never be touched because it’s decentralised but this isn’t the case.
There are several ways to use crypto but only one is truly decentralised and immune to any form of censorship and that’s storing your crypto in a so-called ‘cold wallet’.
In other words, this is when you store your crypto in a hardware wallet (ie, HDD, USB key, etc) that is not connected to the internet.
Everything else could potentially be subject to regulation, at least to some extent.
