Privacy Advocates, Crypto Leaders, Enthusiasts Cry Foul Over US Govt's Tornado Cash Ban

Privacy advocates, cryptocurrency leaders and investors have condemned the U.S. Treasury Department's move to ban the Ethereum mixing tool Tornado Cash.

The department sanctioned the popular cryptocurrency mixing service Monday and added certain ETH addresses to the Specially Designated Nationals list, including its official website, therefore prohibiting Americans from transacting with the said addresses using the tool.

The U.S. Treasury Departments Office of Foreign Assets Control (OFAC) noted in an announcement Monday that the ban was put in place because the virtual currency mixer "has been used to launder more than $7 billion worth of virtual currency since its creation in 2019."

This did not sit well with some crypto enthusiasts who found the government's action a massive attack on cryptocurrency's ethos as a decentralized financial system that should shield its users' privacy.

Stacks co-founder Munib Ali, who goes by the Twitter handle @muneeb, said the OFAC list is meant for people and not "tech tools," which is what Tornado Cash is. He added that privacy tools are for every American and called the latest sanction as the start of a "crypto war."

"It's time to put our crypto tribalism aside; the crypto wars II are starting: US Treasury puts privacy tool Tornado Cash on the sanctions list. This list is meant for people, not tech tools. Privacy tools are for every American," he wrote in a tweet.

For lawyer and Blockchain Association Head of Policy Jake Chervinsky, OFAC's decision to sanction Tornado Cash "threatens that smart & balanced approach to crypto." He noted that while the Blockchain Association fully supports the U.S. Treasury's "mission to combat illicit activity in crypto," they are "concerned that today's decision crosses a line that the US government has always respected & should continue to uphold as a matter of good policy."

Erik Vorhees, founder of the open-source crypto platform Shapeshift, thinks the only ones "hurt" by the U.S. government's decision are "law abiding Americans." "I'm sure the bad guys will stop using Tornado Cash because it's 'illegal' Just like they don't use illegal weapons, smuggle illegal drugs, or illegally launder money through every means they can find. Law abiding Americans are the only ones hurt by this," he said on Twitter.

Meanwhile, a Twitter user who goes by the handle @torkel called the government's decision "disgusting," noting, "Privacy is not a crime. Seeking privacy isn't immoral. Don't let the government gaslight you into thinking the default state should be total surveillance and third party insight your finances and other personal issues. OFAC blacklisting Tornado Cash is disgusting."

Following the OFAC's sanction, Tornado Cash founder Roman Semenov shared that his Github account was suspended.