Vitalik Buterin shared that he used Tornado Cash, recently sanctioned by the US Treasury, to make donations to Ukraine.
Vitalik Buterin, co-founder of the second leading cryptocurrency Ethereum, said he used Tornado Cash, the now sanctioned cryptocurrency mixing service.
“I will introduce myself as someone who has used TC [Tornado Cash] to donate to [Ukraine],” Buterin wrote in a tweet, agreeing with another user who noted that services like Tornado Cash are often used for good causes, such as donations to Ukraine.
Jeff Coleman, co-founder of Counterfactual, twitted that, “Wanting to donate to Ukraine is a great example of a valid need for financial privacy […] on this note, curious if there are any documented examples of TC having been used for this.”
To such post on Twitter, Buterin replied that, “I’ll out myself as someone who has used TC to donate to this exact cause.”
Sanctions against Tornado Cash
Tornado Cash is an Ethereum-based smart contract mixer, which has been sanctioned by the US Treasury Department’s Office of Foreign Assets Control (OFAC).
According to the US Treasury Department, Tornado Cash “has been used to launder more than $7 billion in virtual currencies since its inception in 2019,” including $455 million stolen by Lazarus Group, a group of hackers sponsored by the Democratic People’s Republic of Korea (DPRK).
Tornado Cash co-founder Roman Semenov shared that his GitHub account was suspended, along with a number of other TC resources, including the Tornado Cash GitHub organization, smart contract addresses linked to Tornado Cash on Circle, Infura’s RPC, and others.
Community Reaction
The ban sparked a discussion about services like Tornado Cash that are used for transactions in the crypto industry and their proper regulation.
Jerry Brito, CEO of Coin Center, a non-profit organization that works with the political problems facing cryptocurrencies, pointed out that this prohibition seems to be the sanction of “a tool that is neutral in nature and that can have good or bad uses, like any other technology,” instead of taking action against a single person or agency.
Jake Chervinsky, a crypto attorney and chief policy officer at the Blockchain Association, said that while the association supports the “mission of the US Treasury to combat illicit activity in crypto,” they are also concerned that the mixer ban “has crossed the line” that the US government has always respected [and] should continue to uphold as good policy.”
He also added that this decision to “sanction […] a decentralized protocol, threatens that smart [and] balanced approach to cryptocurrencies,” which the agency has supported before.
It is worth remembering the huge losses suffered by investors during notable incidents such as the collapse of UST, the fall of high-profile companies such as Three Arrows Capital, and the theft of cryptocurrencies by nation-states such as North Korea.
In this sense, the United States has made it clear that it will allow the market to continue to develop, but in a responsible manner. This is a position that US Treasury Secretary Janet Yellen vehemently holds.
By Audy Castaneda
