OFAC Web3 FAQs
Answers to common questions about OFAC sanctions and web3, covering wallets, smart contracts, and on-chain agent payments.
TL;DR
TL;DR: OFAC applies to web3 because wallet and contract addresses can be designated on the SDN List. Screen a counterparty before an agent or protocol pays, and treat ALLOW as pass and BLOCK as stop.
Why web3 is in scope
Web3 applications move value through wallet addresses and smart contracts. OFAC has designated both wallets and smart contracts, with Tornado Cash as the precedent for contracts. Strict liability means a transaction with a designated address is a violation even when no one intended one. That makes address-level screening the core control for web3 payments.
Common questions
- Can OFAC sanction a smart contract? Yes, Tornado Cash set the precedent for designating contract addresses.
- How fast is the check? One HTTP call in under 100 ms, so it fits inside a payment step.
- What data is checked? 947 OFAC-listed crypto wallets and 19,218 SDN names, synced hourly.