US Court Dismisses Appeal to Lift Sanctions on Tornado Cash
A US Federal Court has rejected the appeal of several Tornado Cash users who sought to remove the sanctions imposed on the cryptocurrency mixer. The court determined that Tornado Cash qualifies as an association and is subject to sanctions under OFAC regulations. This decision comes after the US Department of Treasury’s OFAC added Tornado Cash to its SDN List in August 2022, citing allegations of money laundering.
Main Points:
- The court dismissed the request of six Tornado Cash users to lift sanctions against the cryptocurrency mixer.
- The court considers Tornado Cash to be an association and subject to OFAC regulations.
- Tornado Cash users argue that it is a decentralized software project, not an association.
- The OFAC sanctioned Tornado Cash due to allegations of enabling $7 billion in illicit funds flow.
- The sanctions led to a 50% decrease in monthly users for Tornado Cash.
Hot Take:
The US Federal Court’s decision to uphold the sanctions on Tornado Cash highlights the challenge of defining decentralized projects within existing regulatory frameworks. While Tornado Cash users argue for its classification as autonomous software, the court’s ruling demonstrates the jurisdiction of OFAC to designate and enforce sanctions. This case raises important questions about the intersection of decentralized technology and traditional regulatory systems.
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