The US government is pursuing individuals involved in Tornado Cash, citing concerns about money laundering. The Ethereum application essentially enables the creation of a pool to allow privacy and execute transactions. Users can shield their identities while transactions remain public and trackable. Thereby, justifying the principles of blockchain technology. Tornado Cash does not charge any fees; if it does, it is close to negligible. However, concerns around money laundering are hard to ignore by relevant authorities.
The ones in the front likely hail from North Korea. The Treasury Department flagged the same in 2022, calling the platform a mixer, for it facilitates money laundering more than transfer and/or exchange among users. Authorities didn’t specifically target the entity itself. They arrested one developer and charged the other three with money laundering.
Other allegations against their names include conspiring to violate sanction laws and conspiring to operate an unlicensed money transmitter.
Tornado Cash’s justification falls short of being convincing. It stated in the argument that their platform only acted as a money transmitter, receiving and transmitting currency. Noted attorney, Alexander Damsker, said that that does not serve as a great argument, adding that it does not save them much. Nevertheless, better arguments are on the table for Tornado Cash to explore as the issue progresses.
Alexander has highlighted that the case serves more as a piece of hypocrisy than anything else. He said that the federal government may have created something similar in the past. The tracing goes back to 1995 when The Onion Layer Project was created by three scientists for the purpose of using the Internet without being tracked. The Defense Advanced Research Projects Agency and the Naval Research Lab jointly funded the project, which transitioned to Tor in 2006. The dark web recognized it as its primary browser.
The US government used Tor primarily to pass and receive code intelligence messages to protect the identities of its agents and dissidents, according to Damsker.
The principles behind Tor and Tornado Cash are the same: users can keep their identities private. Tor also takes a ride on money laundering, as several adversarial nations can access the browser. The government, Alexander adds, not only accepts but also invites people to participate. Alexander suggests that users mark their original internet protocol addresses, also known as IP addresses, using a VPN.
It will be interesting to see how the US government and other pertinent authorities respond to Tornado Cash in the future.
TORN, the native cryptocurrency of Tornado Cash, is down 1.26% in the last 24 hours. At the time of writing this article, it was exchanging hands for $2.68. It also reflects a 17.74% drop in the last 30 days. The market cap has taken a hit of 1.26%. The 24-hour trading volume is up by 3.40%.
