Blockchain Founder Defends On-Chain Legal Enforcement for Crypto Mass Adoption

The Trade-off for Crypto Adoption

The founder of layer-1 blockchain Jurat has come forward to defend his protocol against potential criticism, arguing that on-chain legal enforcement is a necessary trade-off for the mass adoption of cryptocurrencies. This comes after a U.S. District Court recently used Jurat's on-chain enforcement tool to lock several individuals out of their crypto accounts. These individuals had been sanctioned for money laundering and using ransomware to benefit North Korea's weapons program.

Connecting Blockchain with Court Orders

Jurat's blockchain, launched in late 2022 as a fork of the Bitcoin blockchain, connects blockchain nodes with court dockets to enforce court orders. The founder and CEO of Jurat, Mike Kanovitz, acknowledges that this technology may face criticism from decentralization purists, but believes it can provide the necessary due process protections for digital assets, ultimately driving mainstream adoption. Kanovitz states, "Some of the people who currently think that there should not be effective law enforcement on-chain would feel differently if they got hacked, defrauded, or lost their private keys. Then they would be relieved that they can recover their property."

Taming Lawlessness and Unlocking Utility

In the first half of 2023, a staggering $656 million in cryptocurrencies were lost to scams, hacks, and rug pulls, according to a report by blockchain security firm Beosin. Kanovitz believes that on-chain legal enforcement can not only address this lawlessness, which scares away potential adopters and draws the ire of government officials, but can also unlock incredible utility for commerce.

The On-Chain Enforcement Tool

Traditionally, courts have had limited means to effectively freeze and seize crypto funds. One common tactic has been to order centralized crypto exchanges to freeze funds or provide identifying information of suspects. However, Jurat's on-chain enforcement tool works differently. It connects Jurat's blockchain and software nodes with the user's chosen court. During a lawsuit, each party provides the court with a competing hash for what they want the court to do. When a ruling is made, the court simply pastes the hash of the winning side, and the software nodes autonomously execute the order by accessing the online court docket.

Future Plans for Expansion

Currently, the on-chain enforcement tool only works in the United States and for the JCT blockchain. However, Kanovitz hopes to bring Jurat's technology to other Ethereum Virtual Machine-compatible blockchains in the future.