Polkadot forum proposal would bar Treasury grants to sanctioned parties and high-risk countries
Victoria Shinder2 min readA proposal posted to the Polkadot forum on 30 September would set a financial-crime policy for the Polkadot Treasury, the on-chain fund that OpenGov referendums spend. Under it, Treasury money could not go, directly or indirectly, to sanctioned people or organisations, to projects based or mainly spending in a list of Restricted Jurisdictions, or to recipients where there are unresolved concerns that funds could be diverted.
The reasoning. The author argues that once money leaves the Treasury it can pass through intermediaries or be converted, so identifying the first recipient is not enough to know where it ends up. The Treasury should therefore apply preventive rules rather than rely on investigations after payment. The post uses the sanctions programmes of the US Treasury's Office of Foreign Assets Control (OFAC) and other internationally recognised indicators as its baseline.
Who would be excluded. Persons designated under OFAC programmes and anyone they own, control or act for; activities involving sanctions evasion, narcotics, terrorist financing, money laundering or organised crime; and projects whose main beneficiary or substantial spending is in a Restricted Jurisdiction. A country could land on that list if it is under comprehensive US or equivalent sanctions, if the Financial Action Task Force lists it as high-risk or under increased monitoring, if FATF evaluations find serious gaps in its anti-money-laundering rules, if an OpenGov referendum designates it, or if the DAO decides its risk is too high.
What grantees would have to disclose. The beneficiary's legal name, beneficial owners where applicable, country of incorporation, main operating jurisdictions, the address receiving funds, the intended use and any sanctions exposure. Missing information would be grounds for rejecting a proposal. If a recipient is later sanctioned or breaks the policy, future payments could be suspended and OpenGov could try to recover funds where technically and legally possible. The list would be reviewed at least annually, with reasons published for every addition and removal.
Status. It is a discussion post by a community member, not a referendum, and it had drawn no replies on the forum when this article was written. The author stresses that the policy is not meant to judge populations or nationalities, only to set a risk threshold for community funds.
What it means
Polkadot's Treasury has paid out large sums through open referendums, and who receives them has been debated before. A written risk policy would give voters a common test instead of case-by-case arguments. It would also raise new questions the draft leaves open: who checks the disclosures, against which lists, and how a permissionless chain treats the many contributors who live in the listed countries but do nothing wrong.