Blockchain Groups Support Tornado Cash Lawsuit

The Blockchain Association and the DeFi Education Fund are the most recent industry advocates to support Coin Center’s lawsuit against the United States Treasury for its “illegal” sanctions against Tornado Cash.

The two cryptocurrency industry advocacy organizations filed a joint amicus brief supporting Coin Center on June 2, arguing that U.S. sanctions against the cryptocurrency aggregator should be lifted.

They referred to the sanctions imposed by the Treasury’s Office of Foreign Assets Control (OFAC) as “unprecedented and unlawful,” adding that:

“OFAC’s sanctions are unlawful. OFAC lacks statutory authority to sanction software like Tornado Cash, and regardless, its decision lacks any factual predicate that could render the sanctions lawful.”

The associations argued that Tornado Cash is software while OFAC has the legal authority to sanction individuals or property, it cannot approve a decentralized protocol.

“The core Tornado Cash software is not and cannot be owned by anyone,” they argued, alleging OFAC “invented” a “person” to justify its decision to sanction the cryptocurrency mixer a

The brief acknowledged the malignant use of the protocol for money laundering, primarily by hackers with ties to North Korea, but also highlighted less nefarious services, such as enhancing privacy on the publicly viewable Ethereum blockchain.

The groups argued that the courts should declare the sanctions unlawful and prohibit their implementation.

In April, both organizations filed amicus briefs in support of a suit brought by six individuals against the Treasury Department regarding its Tornado Cash sanctions.

The lawsuit, filed in September, is supported by the cryptocurrency exchange Coinbase, which wants to lift the restriction on the mixer.

The Treasury, on the other hand, asserted that such crypto mixers pose a threat to national security and that Tornado Cash repeatedly failed to implement controls to prevent money laundering.