Arbitrum DAO Drops Tornado Cash Legal Funding Proposal

Arbitrum DAO Drops Tornado Cash Legal Funding Proposal

Arbitrum DAO Drops Tornado Cash Legal Funding Proposal

Arbitrum DAO has decided against a proposal to support the legal defense cost of Tornado Cash creators worth around $1.3 million.

The Arbitrum DAO has removed the proposal to support the legal defense costs of Tornado Cash’s developers from consideration.

Arbitrum DAO Withdraws it’s Support

To support Roman Storm and Alexey Pertsev, the creators of the cryptocurrency mixer Tornado Cash, the proposal proposes to distribute ARB tokens from the community wallet for roughly $1.3 million.

Furthermore, the budget could support public relations and lobbying initiatives to advocate for technology that safeguards individuals’ privacy.

On March 7, the pseudonymous delegate DK made the request, voicing their support for a “robust legal defense” for the developers. This individual was the driving force behind the campaign.

“I can confirm that the forum was removed at the request of the author of the proposal.”

Arbitrum DAO spokeswoman stated that the author requested the removal of the proposal content at a later time. There is still a lack of clarity regarding the reasons behind this adjustment.

Accusations against Tornado Cash and its owners claim that the platform laundered over one billion dollars of illegal funds, including money linked to the hacking group Lazarus Group.

The United States of America has accused the developers for operating an unregistered money transfer business, in addition to accusing them of money laundering and violating sanctions.

Arbitrum DAO Drops Tornado Cash Legal Funding Proposal
Screenshot of the proposal on March 8. Source: Snapshot/Arbitrum DAO

Authorities took Pertsev into custody in the Netherlands in August 2022, and the Federal Bureau of Investigation took Storm into custody in August 2023.

There is still no sign of Roman Semenov, the third person to co-found Tornado Cash. An argument put forth by supporters of Tornado Cash is that the cryptocurrency offers software for decentralized money transfer and does not directly engage in the process of money transmission itself.

The crackdown on the platform poses a risk to developers working on applications focused on protecting users’ privacy. The developers have encountered other financial difficulties.

On February 16, GoFundMe decided to stop a fundraiser collecting legal fees for Storm and Pertsev. The reason given was that the fundraiser was a violation of their terms of service, which might “expose GoFundMe, its employees, or users to any harm or liability of any type.” 

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