MetaMask and Infura, two core elements of the Ethereum ecosystem including NFTs, have stopped serving users in "certain jurisdictions due to legal compliance," according to a MetaMask page that was updated on Thursday.
MetaMask is the most popular crypto wallet for Ethereum users, including NFT traders. It is owned by the same parent company as Infura, which is a centralized API that feeds MetaMask data from the Ethereum blockchain. The MetaMask blog post appeared to place the blame for the block on certain users on Infura.
"By default, MetaMask accesses the blockchain via Infura, which is unavailable in certain jurisdictions due to legal compliance," the brief blog states. MetaMask says that blocked users will encounter a message saying the wallet cannot connect to the blockchain host when they attempt to use the wallet. MetaMask's blog included a link to instructions for users to restore their crypto wallet elsewhere using a seed phrase.
As for which countries are affected by the ban, reports began flooding social media on Thursday morning that users in Venezuela were no longer able to use MetaMask. Motherboard downloaded MetaMask and set it up from scratch while using a VPN routing through Venezuela, and experienced no interruption although we stopped short of actually sending a transaction.
On Thursday, Infura posted a statement to Twitter saying that the ban on Venezuelans was a mistake. The company was updating settings to comply with new sanctions directives and set them too broadly, it said.
“In response to the concerns we have been hearing, we want everyone to know that we corrected the problem that so many of you have pointed out,” the company stated in a tweet. “In changing some configurations as a result of the new sanctions directives from the United States and other jurisdictions, we mistakenly configured the settings more broadly than they needed to be. This was our oversight, and we are grateful that it was pointed out to us. Once we determined what happened, we were able to fix the problem, and service has been restored.”
A spokesperson for Consensys, the company that develops both MetaMask and Infura, reiterated in an emailed statement that the blame lay with Infura—which must comply with U.S. sanctions—and that Metamask is client-side software, so users can configure their wallets to use another node.
The firm also clarified that Infura was updating its blocklist to comply with Ukraine-related sanctions.
“Yesterday, certain MetaMask users in Venezuela complained that their wallet was giving them an error message,” the Consensys spokesperson wrote. “Once these reports reached the MetaMask team, it informed the Infura team, which investigated the issue immediately. It was quickly determined that, when updating configurations that Infura put in place to comply with recently announced U.S. sanctions programs concerning the Donetsk and Luhansk regions of Ukraine, additional restrictions were mistakenly triggered that caused the Infura nodes to not serve wallets in certain jurisdictions including Venezuela. This error was promptly corrected, resulting in the access controls being configured to restrict only those regions which Infura and all other U.S.-based blockchain service providers are required by law not to service. Those sanctioned jurisdictions today are Iran, Cuba, North Korea, Syria, and the Crimea, Donetsk, and Luhansk regions of Ukraine. Infura has already put in place measures to ensure that similar configuration errors do not occur in the future.”
There are also reports on social media of users from Iran being blocked on OpenSea. "NOT A gm AT ALL," tweeted a user going by Bornosor.eth on Thursday. "Woke up to my @opensea trading account being deactivated/deleted without notice or any explanation, hearing lots of similar reports from other Iranian artists & collectors.What the hell is going on? Is OS straight up purging its users based on their country now?"
NFT artist Parin Heidari reported that their NFT collection on OpenSea now 404s in response to Bornosor.eth's tweet. Heidari tweeted that they are Iranian but haven't lived there in years, and are currently based in Italy.
"What you are doing to us artists is even way worse that what [Iran's government] have done to us," Heidari tweeted. "Cause you assume you are a decentralized platform. If you don’t care about the Iranian artists, fine. At least care about our NON IRANIAN collectors."
Motherboard attempted to connect to OpenSea with a VPN routing through Iran and received an "access denied" error message.
In a statement, OpenSea confirmed that it is banning users to comply with U.S. sanctions.
“OpenSea blocks users and territories on the U.S. sanctions list from using our services—including buying, selling, or transferring NFTs on OpenSea—and our Terms of Service explicitly prohibit sanctioned users or users in sanctioned territories from using our services,” an OpenSea spokesperson said in an emailed statement. “We have a zero tolerance policy for the use of our services by sanctioned individuals or entities and people located in sanctioned countries. If we find individuals to be in violation of our sanctions policy, we take swift action to ban the associated accounts.”
In response to a follow-up question about Heidari’s ban, the spokesperson said OpenSea does not comment on individual accounts and directed us back to the company’s statement.
MetaMask and Infura have been at the center of discussions around how centralized the supposedly decentralized world of crypto really is. In a blog post last year, Signal developer Moxie Marlinspike revealed how MetaMask relies not just on Infura, but also NFT marketplace OpenSea to display NFTs. When OpenSea experienced a service outage recently, MetaMask could not display new NFTs.
The new bans on users in certain locations is certain to spark a new round of discussion about centralization in the crypto industry, particularly as the topic has been front and center amid sanctions against Russian individuals and entities during the ongoing invasion of Ukraine. Exchanges have said they are complying with all existing sanctions, while still allowing Russian and Ukrainian citizens alike to use their services. Regardless, U.S. politicians including Senator Elizabeth Warren sent a letter to the Treasury Department on Wednesday expressing concern over Russia using crypto to evade sanctions, despite a lack of evidence, and inquiring what the department's capabilities are in enforcing sanctions in the crypto industry.
Joseph Cox contributed reporting.
Update 1: This story has been updated with comment from OpenSea.
Update 2: This story has been updated to include comment from Infura and MetaMask on Twitter.
Update 3: This story was updated to include comment from Consensys.
Correction: An earlier version of this story stated that the MetaMask page was posted on Thursday, when in fact it was updated on Thursday to explain Infura and MetaMask’s interoperability and advise users about the block notification if they attempted to use the service.