US Treasury Sanctions Tornado Cash Co-Founder for Money Laundering to North Korea
On August 23, the US Department of Treasury imposed sanctions on Roman Semenov, co-founder of Tornado Cash, for his alleged involvement in money laundering to North Korea. This comes as US regulators have been cracking down on the crypto mixer for violating US sanctions.
Key Points:
- Roman Semenov, co-founder of Tornado Cash, has been sanctioned by the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) for offering material support to Tornado Cash and the Lazarus Group.
- The FBI and the IRS have also arrested another co-founder, Roman Storm, on charges of conspiracy to operate an unlicensed money-transmitting business.
- Tornado Cash is a crypto mixer service that enhances user privacy by blending the source of a transaction before sending it to the intended recipient.
- The founders of Tornado Cash knowingly allowed the Lazarus Group to utilize their mixing service to launder stolen virtual currency, despite being aware of its illicit usage.
- In 2019, the Lazarus Group used Tornado Cash to obscure the transfer of over $455 million stolen during an assault on Axie Infinity’s Ronin network bridge.
Hot Take: The US government’s action against the co-founders of Tornado Cash highlights the increasing scrutiny on crypto mixers and their potential involvement in money laundering activities. This case serves as a warning to others in the industry that facilitating illicit transactions will not go unnoticed or unpunished.
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