BlackRock BUIDL Platform Hit by 0.97 ETH Tornado Cash inflow

BlackRock faces legal scrutiny after receiving 0.97 ETH from Tornado Cash, a cryptocurrency mixer associated with money laundering.

Tornado Cash is a well-known cryptocurrency mixer that is notorious for its ability to facilitate money laundering. According to reports, the recently established institutional cryptocurrency fund of BlackRock Inc. received 0.97 Ethereum (ETH) through Tornado Cash.

The United States Securities and Exchange Commission (SEC) received a filing from the investment asset management company BlackRock on Tuesday, announcing the establishment of a new tokenized asset fund.

BlackRock USD Institutional Digital Liquidity Fund (BUIDL), a partnership with Securitize, established the new fund. This well-known enterprise provides financial services.

When BlackRock first introduced its tokenized asset fund, it garnered significant attention. BlackRock is a prominent asset manager. Specifically, BlackRock endeavored to broaden its presence in the digital asset ecosystem and to create a foothold there.

The fund suddenly attracts attention for the wrong reasons—a fascinating turn of events. Data collected approximately 36 hours after the program’s introduction shows that Tornado Cash spammed a wallet associated with BUIDL with unsolicited cryptocurrency.

Considering the current price of the cryptocurrency on the market, Arkham Intelligence estimates that 0.97 ETH is equivalent to around $3,324 in value. BlackRock may face legal issues as a result of the ongoing investigation into the cryptocurrency mixer in question.

BlackRock Impending Legal Conflict

In August 2022, the Office of Foreign Assets Control (OFAC) of the United States Treasury Department imposed sanctions against Tornado Cash for enabling money laundering of seven billion dollars.

Additionally, the crypto mixer was caught in the middle of an accusation that involved assisting the Lazarus Group, which is a hacker group that is supported by the state of North Korea.

Dutch authorities recently handed down an indictment against Alexey Pertsev, the inventor of Tornado Cash, for his involvement in the laundering of $1.2 billion through the use of the cryptocurrency blender.

The case of Pertsev included as many as 36 recorded cases, one of which involved the theft of 175 ETH from the crypto protocol Ronin Bridge, which is affiliated with Axie Infinity.

Prosecutors in the Netherlands included decentralized protocols like Harmony and Nomad Bridge in other illegal transactions.

Because of the OFAC sanction, any individual or organization in the United States, including financial institutions, that owns the restricted property, such as ETH from Tornado Cash, must bring their status to the agency’s attention.

Because of this, BlackRock is now in a situation where it might be involved in a legal struggle, mainly if it does not perform the necessary due diligence requirements.