Tornado Cash recorded volumes of .9 billion in the first half of 2024, data reveals. Large amounts were deposited in the privacy-enabling mixer despite the Office of Foreign Assets Control (OFAC) sanctioning the application. The sanction forbids users from using the application, failing which users cannot exchange their crypto for fiat on US-based exchanges. Wallets interacting with the mixer are blacklisted and prevented from accessing exchange servicers. Tornado Cash is frequented by hackers wanting to obfuscate their fund flows after stealing crypto from users and platforms, putting it in hot water with OFAC. The agency sanctioned the mixer in August 2022 after the notorious North Korean Lazarus Group used it to launder 5 million from criminal activities. Still, Tornado Cash
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Tornado Cash recorded volumes of $1.9 billion in the first half of 2024, data reveals. Large amounts were deposited in the privacy-enabling mixer despite the Office of Foreign Assets Control (OFAC) sanctioning the application.
The sanction forbids users from using the application, failing which users cannot exchange their crypto for fiat on US-based exchanges. Wallets interacting with the mixer are blacklisted and prevented from accessing exchange servicers.
Tornado Cash is frequented by hackers wanting to obfuscate their fund flows after stealing crypto from users and platforms, putting it in hot water with OFAC. The agency sanctioned the mixer in August 2022 after the notorious North Korean Lazarus Group used it to launder $455 million from criminal activities.
Still, Tornado Cash witnesses massive usage, marking an uptick of 50% in the first six months of this year compared to the entirety of 2023. Recently, the WazirX hack conducted by the Lazarus Group on July 18 involved a wallet previously funded by crypto coming from the mixer. The Poloniex hacker, who stole $100 million, moved $76 million to the mixer this year. Those responsible for the HECO Bridge and Orbit Chain hacks have moved over $200 million.
Despite these occurrences, numerous figures and entities within the crypto space continue challenging the OFAC’s sanction on Tornado Cash, calling it unlawful. Since the application is not an entity or country but rather a decentralized infrastructure comprising code, the OFAC’s ban on its usage violates free speech.
Multiple entities, including Coinbase and crypto advocacy groups The Blockchain Association and Coin Center, have funded a lawsuit filed in 2022 to get the OFAC to overturn its sanction. Nevertheless, the US Treasury views crypto mixers as national security threats as they allow criminals to hide their trails and mix ill-gotten funds into the nation’s financial system.