Decentralized finance pioneer MakerDAO has come under fire for its recent decision to block users accessing its newly launched lending platform, Spark Protocol, through virtual private networks (VPNs).
Attempting to access the Spark Protocol website using VPNs triggers an error message stating that VPN access is not allowed.
The move seems to be an effort by MakerDAO to restrict United States users from accessing the platform, as indicated in a May 9 update to Spark Protocol’s terms of service that explicitly discourages the use of VPNs to circumvent this restriction.
The platform’s terms of service also prohibit U.S. users from using VPNs to conceal their residency.
This decision has been met with strong criticism from DeFi analyst Chris Blec and others, who argue that the ban on VPNs affects users worldwide, not just those in the U.S. Blec, a vocal advocate for decentralization and privacy, expressed his dismay on Twitter, stating that this action is essentially a global assault on user privacy.
Blec further criticized MakerDAO’s creator, Rune Christensen, and the company’s developers for prioritizing profits over user privacy.
He accused them of prioritizing their financial interests above the principles of privacy and individual rights.
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Cointelegraph, a cryptocurrency news outlet, reached out to MakerDAO for a comment on the matter but did not receive an immediate response.
Spark Protocol, launched in May, offers users the opportunity to earn up to 8% in annual returns by lending DAI.
The platform was created as a soft fork of Aave v3 by Phoenix Labs, a blockchain research and development firm backed by the Maker Foundation.
Before engaging in cryptocurrency lending on the Spark Protocol platform, users are required to explicitly agree that they are not using VPNs.
The platform also utilizes TRM’s blockchain intelligence services to prevent wallets engaged in legally prohibited activities from accessing Spark Protocol.
The decision to block VPN users has sparked a heated debate about privacy, user rights, and the potential impact on global users of decentralized finance platforms.
As the situation unfolds, stakeholders in the cryptocurrency community are closely monitoring developments and awaiting further responses from MakerDAO.
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