Crypto blender Tornado Cash has won a major legal battle against the US financial regulator. In a groundbreaking decision, a Texas court has overturned sanctions against Tornado Cash. Sanctioned by the U.S. Treasury in 2022 for “money laundering”, Tornado Cash and its main developers have been facing heavy legal pressure in the U.S. and Europe.
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Sanctions against Tornado Cash rescinded
U.S. authorities are increasingly supportive of privacy-protective technological innovations. Just one day after the release of Ross Ulbricht the emblematic founder of Silk Roadc, the crypto mixer Tornado Cash has won an important legal battle. In fact, a court in the Western District of Texas has ruled to cancel the Office of Foreign Assets Control (OFAC) against Tornado Cash.
It is ordered and ruled that the judgment of the district court is vacated and the case is remanded.
Texas Court
In August 2022, the Office of Foreign Assets Control (OFAC) of the U.S. Treasury had sanctioned Tornado Cash. The U.S. regulator accused the crypto blender of laundering money for North Korean hackers from Lazarus Group. According to OFAC, over $455 million in crypto stolen by Pyongyang’s hackers was laundered via Tornado Cash.
Strong crackdown on Tornado Cash users and developers
OFAC sanctions against have led to a wave of repression against Tornado Cash users and major developers. Indeed, some crypto exchanges have been forced to take drastic measures to comply with US legal requirements. These include OKX, which has decided to block the account of any user interacting with Tornado Cash.
For their part, the main developers of Tornado Cash were systematically tracked down both in the USA and abroad. In the USA, Roman Storm and Roman Semenov are sued for money laundering and violation of US sanctions. The former is under house arrest in Washington, while the latter is on the run. Their collaborator Alexey Pertsev is in a slightly trickier situation in the Netherlands. Charged with money laundering, he has been sentenced to 64 months in prison in May 2024. His efforts to obtain parole are still unsuccessful.
Despite this untenable legal pressure, the developers of Tornado Cash enjoy invaluable support from the crypto community. From Edward Snowden to Vitalik Buterin, several leading figures in the ecosystem have publicly contributed to Tornado Cash’s legal defense fund.
The cancellation of the sanctions against Tornado Cash is good news for the crypto blender. Its developers have one more argument to make to get the charges against them dropped. It’s also good news for TORN crypto holders. The native token of Tornado Cash pumped from $9 to $25.5 after the announcement.
I dream of a world where every citizen has total control over themselves, including their finances. I believe that Bitcoin is one of the tools that will achieve this revolution. Since 2019, I am learning about this cryptocurrency and spreading the word around.
