U.S. Treasury Lifts Sanctions on Tornado Cash Following Legal Reassessment
The U.S. Treasury Department has officially removed sanctions against Tornado Cash, a cryptocurrency mixing service previously accused of facilitating money laundering for the North Korea-linked Lazarus Group.
The U.S. Treasury Department has officially removed sanctions against Tornado Cash, a cryptocurrency mixing service previously accused of facilitating money laundering for the North Korea-linked Lazarus Group. This decision follows a review of the complex legal and policy issues surrounding financial sanctions in the evolving digital asset landscape.
In addition to lifting sanctions on Tornado Cash, the Treasury has also delisted over 100 Ethereum (ETH) wallet addresses from the Specially Designated Nationals (SDN) list. The move comes after a U.S. Fifth Circuit Court ruling in November 2024, which determined that OFAC had exceeded its legal authority by sanctioning Tornado Cash, as its immutable smart contracts do not constitute "property" under the International Emergency Economic Powers Act (IEEPA).
Despite this decision, the Treasury reaffirmed its commitment to combating cyber threats and preventing North Korea from using digital assets to finance its weapons programs. Treasury Secretary Scott Bessent emphasized the importance of securing the digital asset industry to maintain U.S. leadership while fostering innovation.
Meanwhile, legal action against Tornado Cash’s founders continues. In May 2024, Dutch courts sentenced co-founder Alexey Pertsev to over five years in prison, while Roman Storm and Roman Semenov face U.S. federal charges.
