Tornado Cash Sanctions Called “Unprecedented And Unlawful” By The Blockchain Association

The Blockchain Association and DeFi Education Fund have filed an amicus brief calling the U.S. Treasury Department’s decision to sanction Tornado Cash “unprecedented and unlawful.”

Until OFAC imposed sanctions, Tornado Cash was the most popular privacy-protecting tool on Ethereum, the world’s second-largest digital asset platform. The software is self-executing computer software published on the Ethereum blockchain, and it functions automatically without any human intervention or assistance.

Blockchain Association Takes On U.S. Treasury Over Tornado Cash Sanction

The filing argues that the decision to sanction Tornado Cash reflects a basic misunderstanding of the software and its workings. The protocol was the most popular privacy-protecting tool on Ethereum until the Office of Foreign Asset Control (OFAC) imposed sanctions.

The amicus brief highlights the importance of Tornado Cash as a tool for protecting the privacy of digital asset users. It argues that Americans are using digital assets more than ever, with 20 percent of American adults owning digital assets and 29 percent planning to buy or trade digital assets.

The brief also notes that software like Tornado Cash can be misused for illicit purposes but is primarily used for legitimate and socially valuable reasons. The filing further claims that the sanctions exceed OFAC’s statutory authority and result from “arbitrary-and-capricious decision-making.”

OFAC sanctioned the protocol on November 18, 2021, along with seven other entities, for their alleged involvement in facilitating ransomware payments. OFAC designated Tornado Cash as a “Specially Designated National” (SDN), meaning that U.S. persons are generally prohibited from engaging in transactions with or providing services to the protocol. The sanctions on Tornado Cash were imposed under Executive Order 13694, which targets the malicious cyber activities of individuals and entities.

As reported by Bitcoinist, Crypto think tank Coin Center has been one of the

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Author: Ronaldo Marquez

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