✍️ 13 October, 2022 – 11:11 👤 Editor: Jakub Motyka
- The crypto think tank is accusing the department of banning Tornado Cash.
- Regulators are investing the crypto mixer for money laundering claims.
- The latest news about crytos, in our Telegram channel.
Coin Center has sued the US Treasury Department for sanctioning Tornado cash in August. The non-profit crypto advocacy group said that the department acted outside its roles as per the International Emergency Economic Powers Act.
Filed with the US District Court of Florida, the lawsuit has pointed out some of the mandates of the Office of Foreign Asset Control. It argues that the department is only required to prevent US citizens from dealing with foreign persons or entities.
The Advocacy Group Faults The Treasury For Inconvenience
Because of the Tornado Cash ban, Coin Center stated that crypto users have been inconvenienced. The group complained that Americans seeking privacy usually opt for Tornado Cash for the privacy of their transactions on Ethereum.
In this case, the lobby group added that OFAC curtailed such users their right to privacy. Further, the special interest group is criticizing Biden’s administration for blocking donor funds to its coffers since the suspension.
Before the ban, patrons reportedly used Tornado cash when transferring money to the advocacy. Coin Center executive Jerry Brito reiterated that the agency indeed overreached its authority. Brito remarked that the litigation is a bigger fight against over regulating digital assets, which could negatively affect the sector.
Coinbase Sponsored A Similar Lawsuit In Support Of The Crypto Mixer
In September, crypto exchange Coinbase financed a related lawsuit pitting the US Treasury and Tornado Cash users. In the action, the plaintiffs disclosed they could not access their funds locked in Tornado Cash due to the sanctions.
Tornado cash obscures crypto transactions by hiding their sources. It is touted as a privacy tool in the blockchain space. The platform works by concealing the sources of the assets and mixing them with other transactions.
However, rising cases of theft and fraud have gotten the law enforcers’ attention. The US government, for instance, has committed to a crackdown on crypto mixers. It has termed them as a money laundering platforms.
At the same time, the lawsuit news has subdued the price of the native Tornado Cash token, TORN. The crypto is down 10% in the past day at $4.98. Generally, cryptos are facing bearish momentum. BTC is trading at $19k, while ether was at $1,276 at the time of writing.
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