The Blockchain Association has filed an amicus brief in a lawsuit filed by the think tank Coin Center against the Treasury Department and the Office of Foreign Asset Control. The brief has to do with the latter two agencies’ sanctions against crypto mixer Tornado Cash. Tornado Cash Has Some Soldiers Fighting for It Last year, sanctions were filed against Tornado Cash after it was alleged that the tool had been used to launder crypto funds garnered by bad actors in North Korea, who were using the money to build the nation’s ongoing nuclear program. It’s alleged that the tool has been utilized to launder over billion dollars in crypto. At the time, Brian Nelson – Secretary of the Treasury for Terrorism and Financial Intelligence – mentioned in an interview:
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The Blockchain Association has filed an amicus brief in a lawsuit filed by the think tank Coin Center against the Treasury Department and the Office of Foreign Asset Control. The brief has to do with the latter two agencies’ sanctions against crypto mixer Tornado Cash.
Tornado Cash Has Some Soldiers Fighting for It
Last year, sanctions were filed against Tornado Cash after it was alleged that the tool had been used to launder crypto funds garnered by bad actors in North Korea, who were using the money to build the nation’s ongoing nuclear program. It’s alleged that the tool has been utilized to launder over $7 billion dollars in crypto.
At the time, Brian Nelson – Secretary of the Treasury for Terrorism and Financial Intelligence – mentioned in an interview:
Despite public assurances otherwise, Tornado Cash has repeatedly failed to impose effective controls designed to stop it from laundering funds for malicious cyber actors on a regular basis and without basic measures to address its risks. The Treasury will continue to aggressively pursue actions against mixers that launder virtual currency for criminals and those who assist them.
In the lawsuit against the Treasury, Coin Center said the sanctions against Tornado Cash have blocked Americans from using the tool and from trading privately. Blockchain Association CEO Kristin Smith explained in a recent statement:
It’s critical to recognize that Tornado Cash is simply a tool. Punishing the tool itself simply because it can be used by anyone, including bad actors, runs contrary to the values this country was founded upon. Blockchain Association stands with Coin Center, advocating for the responsible and lawful use of blockchain technology. Regulatory actions should only be targeted at bad actors who abuse this tool for illegal purposes.
This is the second lawsuit filed against the Treasury over its sanctions of Tornado Cash, which has been getting hit by agencies since last August. OFAC was the first department to file sanctions against Tornado (nearly one year ago), claiming hackers in North Korea laundered hundreds of millions of dollars in crypto just weeks after it was first put in play.
A Lot of Illegal Activity
It’s estimated that as many as 20 percent of the transactions to be put through Tornado have been illicit. The present Coin Center suit explains:
An order effectively requiring [the] defendants to decriminalize use of the 20 Tornado Cash addresses would allow [the] plaintiffs to conduct their legitimate activities with some measure of anonymity, use their preferred software tool without fear of penalties, and engage in important expressive associations. Judicial relief would also serve the public interest by averting harm to Tornado Cash users who are United States persons, to Ethereum as a freedom and privacy enhancing technology, and to the important sector of the economy that depends on Ethereum.