So if a sanctioned address sends coins to a different address and that address trades for an nft the nft owner has violated sanctions? So now every time you exchange crypto you have to check if the other party is on a sanction list? What if you want to make a wallet illicit? Don’t you just need to mix some coins and send them to that wallet?

Again, this is all very simple. Someone who transacts with an address that is on a sanctions list is in violation of sanctions.

So all you have to do is send your coins to a new address once they’ve been mixed? Who’s to say the same person owns both wallets?

Yes, sanctions lists are a cat-and-mouse game. Cryptocurrencies did not invent this dynamic. Dictators have been doing the same with shell companies and offshore bank accounts for decades.

> Again, this is all very simple. Someone who transacts with an address that is on a sanctions list is in violation of sanctions.

You sound like one of those devs who shunned Dropbox because it's just a simple internet backed up folder you could implement with rsync and some python.

The world isn't that simple and if these "simple rules" turn out to be too complex to easily reason about we as a society will just ignore them.

I'm just telling you how the sanctions work. That part is simple.

Yes, this could have some complicated implications for compliance with that law. This is why big banks employ thousands of people in their compliance departments. If you're in country [x] and you're transferring money, you have to follow laws on transferring money in country [x].

Now yes, if compliance is hard, observed compliance may be low. This affects many laws on the books, and if it becomes a problem for regulators, they may take further action to improve enforcement, as they did with capital gains on crypto transactions at exchanges.

This has nothing to do with rsync/dropbox.