In a statement Monday morning, the Treasury announced it was sanctioning Ethereum-based Tornado Cash for allegedly helping to launder more than $7 billion worth of cryptocurrency since its creation in 2019, effectively freezing U.S. assets on the platform and barring Americans from using the service.
Laundered funds included over $455 million stolen by North Korea hacking ring the Lazarus Group in the largest known virtual currency heist to date—when North Korean cyberattackers stole some $620 million from an Ethereum-linked platform for NFT-based video game Axie Infinity in March—the Treasury said.
On its website, Tornado Cash says it has helped nearly 40,000 users obfuscate transactions through more than 150,000 deposits that help “achieve privacy” by using smart contracts to route funds to an address with no ether balance and then send it to a new public address that has no link to the original sender.
In a Monday statement, the Treasury’s Brian Nelson said Tornado Cash repeatedly failed to impose effective controls and “basic measures” designed to stop it from laundering funds for malicious cyber actors and pledged to continue to “aggressively” pursue actions against mixers that launder cryptocurrency for criminals.
The move follows the Treasury’s first-ever sanctions on a virtual currency mixer in May, when it designated Blender.io for allegedly also helping to carry out the Lazarus-backed crypto heist in March—to the tune of more than $20.5 million worth of illicit proceeds.
Read the full story on Forbes: https://www.forbes.com/sites/jonathanponciano/2022/08/08/treasury-sanctions-ethereum-based-tornado-cash-for-allegedly-helping-to-launder-more-than-7-billion/?sh=5d8d67843f97
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