In what is being hailed as a ‘landmark’ decision by the crypto industry, a US court has overturned the sanctions imposed against Tornado Cash. The controversial Crypto Mixer is a Web 3 platform that allows people to shuffle their crypto tokens with some other tokens from a collective pool of digital currencies. This adds more privacy to crypto transactions, making them difficult to track or trace. The US Treasury’s Office of Foreign Assets Control (OFAC) imposed sanctions against Tornado Cash in 2022 for enabling money launderers to move illicit funds and evade law enforcement agencies.
On January 21, the U.S. District Court for the Western District of Texas overturned OFAC’s sanctions against Tornado Cash. The court’s decision was filed by six users of Tornado Cash against OFAC’s actions, which led to an appeal. “It is ordered and decreed that the judgment of the district court is reversed, and the case is remanded to the district court for further proceedings in accordance with the opinion of this court.” ruling Said.
OFAC Allegedly Alleged that Tornado Cash was used by notorious North Korean hackers to launder more than $455 million (roughly Rs. 3,844 crores) that they had earned from crypto thefts and hacks. OFAC had claimed that since its launch in 2019, the platform has facilitated the laundering of $7 billion (approximately Rs 60,509 crore) by 2022.
Between 2022 and 2025 blacklist Tornado Cash has been criticized by the crypto sector, with many arguing that the smart contract technology that Tornado Cash uses to facilitate crypto swapping is not a property of its own that would make OFAC’s sanctions inapplicable under existing laws. Is.
Alexey Pertsev, one of the three co-founders of Tornado Cash, was arrested in the Netherlands following OFAC sanctions. In May 2024, he was sentenced to 64 months in prison for money laundering.
My name is Roman Storm, and I am one of the founders of Tornado Cash, a non-custodial privacy protocol.
I’m being sued for writing open-source code that enables private crypto transactions that are completely non-custodial. This prosecution represents a terrible thing…
– Roman Storm :us: :tornado: (@rstormsf) 22 January 2025
Last November, the Fifth Circuit Court in New Orleans overturned the 2022 sanctions against Tornado Cash. Platform co-founder Roman Storm faces trial on April 14.
