As a seasoned analyst with decades of experience in the financial industry, I have witnessed numerous regulatory battles that shape the future of various markets. This recent ruling by the US Federal appeals court on Tornado Cash is an intriguing development, one that underscores the complexities and nuances of navigating the intersection between privacy, technology, and regulation.
In a significant triumph for the cryptocurrency sector and privacy advocates, a U.S. Federal appeals court has ruled that the U.S. Treasury exceeded its jurisdiction by imposing sanctions on the crypto mixing service Tornado Cash. Previously, in 2022, the Treasury Department claimed that hackers from North Korea had exploited Tornado Cash’s privacy tools to launder a staggering $455 million.
A panel of three judges from the 5th U.S. Circuit Court of Appeals based in New Orleans decided to support six individuals who use Tornado Cash. These individuals contested the lawfulness of sanctions applied to the software.
Users of Tornado Cash contend that, according to U.S. law, the cryptocurrency mixing tool itself cannot be subjected to sanctions. They made it clear that they are distinct from those who wrongfully utilize the software for unlawful activities.
The digital currency trading platform, Coinbase, backed and financed the court case, expressing concern that the penalties might establish an unfavorable precedent within the cryptocurrency sector.
According to a statement by Circuit Judge Don Willett, the court recognized the government’s worries about foreign entities using Tornado Cash to launder funds. However, the panel concluded that federal law enables the Department of the Treasury to seize property rather than software, thus restricting its possible actions. In addition, Circuit Judge Willett wrote:
It’s possible that Congress may revise a law passed during the Carter Administration to address contemporary technologies such as crypto-mixing software. For now, it is stated that Tornado Cash’s unchangeable smart contracts, which serve privacy functions, do not fall under the category of ‘property’ owned by foreign individuals or entities. Therefore, they cannot be restricted or blocked.
Last year in 2022, the United States Treasury Department imposed restrictions on Tornado Cash due to allegations that it facilitated the laundering of more than $7 billion worth of digital assets. More recently, in May, a Dutch court sentenced Alexey Pertsev, a developer for Tornado Cash, to five years in prison.
Remove Tornado Cash Sanctions for Smart Contracts
In response to recent developments, Coinbase’s Chief Legal Officer, Paul Grewal, expressed pride in their role of assisting the cryptocurrency mixing software company as they tackle this legal matter together.
The smart contracts associated with Tornado Cash should now be taken off the sanctions list, allowing U.S. residents to utilize this protocol that prioritizes user privacy once more. In simpler terms, the government’s excessive reach in this matter will no longer be upheld.
Grewal stated that it’s too extreme to restrict an entire software due to wrongdoing by a few criminal elements. He contended that the penalties enforced by the Treasury Department against Tornado Cash surpassed their lawful scope.
Grewal expressed gratitude for the Court’s thoughtful examination of this issue. In the future, we at Coinbase will persist in promoting clear, balanced regulations that encourage technological advancement, not only in the United States but also globally,” concluded Grewal.
Read More
- When Is the Nintendo Switch 2 Announcement Date? Reports Explained
- Who Is Returning on Days of Our Lives This Week?
- Black Panther 3 Producer Gives Clarity on Denzel Washington’s Marvel Role
- Dead Man’s Wire Cast Adds Colman Domingo to Gus Van Sant’s Hostage Thriller
- ‘As long as audience believes they’re husband and wife’: Pragya Jaiswal on working with Nandamuri Balakrishna despite double age gap
- Solana Leaves Competition In The Dust: Blazing Speed To Fuel Price Surge?
- Who Is Kendrick Lamar’s Fiancee? Whitney Alford’s Kids & Relationship History
- Invincible Season 3 Reviews Deliver the Best Rotten Tomatoes Score Possible
- Telegram Rolls Out ‘Stars’ for In-App Purchases
- Godzilla Minus One 2 Update Given, Will Have Bigger Budget Than First Movie
2024-11-27 14:24