Miners have always been free to implement whatever logic they like, though. If you send out a mass communication saying "Address 0x12345 belongs to a very mean guy" and every miner out there denies service to that address, the decentralization properties of your system haven't been violated anywhere.

Decentralization usually includes the assumption that parties are acting independently and are not all colluding.

[Edit: Following the incentives of the protocol is not collusion. In a crypto context I would define collusion as something like multiple parties working together against their own incentives (e.g. rejecting valid, fee-paying transactions).]

If nodes in a network are fully independent and not cooperating, then you don't have a network, you have a bunch of disconnected nodes.

Is cooperating the same as colluding?

In the sense the parent used it, yes.

If a majority of banks and businesses agree to block transactions of a known terrorist, is it collusion or cooperation? I don't see a meaningful distinction at that point, other than the negative connotation of "collusion" poisoning the well. Which is why I referred to "cooperation" instead.

The later has a negative connotation of illegal (or at least secret) cooperation. So it's a form of cooperation.

Which is exactly the fundamental flaw in any argument that "decentralization" will somehow solve problems.

Humans are social creatures and collusion is the natural order. Humans will cooperate unless doing so is clearly to their detriment.

Decentralization doesn't mean isolation and that nobody is cooperating. It's a centrality measure. More decentralized networks have less nodes that hold outsized importance in the network.

that’s not a solid assumption.

if they can pursue their own interests freely and if those interests they pursue align with the majority or the totality it does not negate their decentralized nature.

But I imagine the reason exchanges are refusing these transactions is at least half because they would be receiving stolen property. I'm not sure but I don't imagine "I'm receiving property stolen from another country" will stand up as a defense in any court.

Does law enforcement bother it's self with internet play money? Until it touches an asset or currency governments care about I assumed they just let the kids have their fun.

It's not clear. But the lawyers at these exchanges aren't going to take that risk and will strongly advise against receiving stolen property.

It was marketed as censorship resistant and code is law and blah blah blah.

Decentralization means that each party gets to decide what assets and transactions they view as legitimate.

Decentralization doesn’t mean everything is decentralized, it’s a range of decentralization from fully decentralized to fully centralized. You can use DeFi without ever touching centrally-controlled assets like USDC or Tether. The key thing is that you get that choice.

All I’m seeing is “decentralized” figures making some very centralized moves when they see fit.

Tether is famously centralized, you’re attacking a straw man.

And I think you arefalling for the "true scotsman" fallacy. Tether backs 70%+ of daily BTC trading volumne, saying criticism against Tether is invalid because Tether isn't real crypto is a cop-out given how important it is in the ecosystem.

They are not saying criticism against Tether is invalid, merely that you cannot criticize Tether and call it a "DeFi" critique.

At the end of the day, centralized assets on Ethereum are as legitimate as decentralized ones. The whole point of Ethereum is that it permissionless. If we celebrate Iranians or 16 year olds being able to build on top of it then certainly Goldman Sachs may do so as well.

Bitcoin (and therefore the whole crypto space) should be valued in Tether-Dollars not USD. I wonder how much Tether-Dollars are really worth...

$30M far too small for a hardfork. You need something like DAO too be "too big to fail".

They can only block if you are moving around centralized assets, which really isn't that shocking to anyone. There is a reason the hacker quickly tried to convert it to ETH, etc.

The miners will not block as it would destroy the credibility of eth itself. It would probably hard fork if such a thing were attempted. So dumb for them to even suggest it