Tornado Cash Most Used In Majority Of Security Incidents During Q1: Security Firm

Decentralized cryptocurrency mixer Tornado Cash was the preferred choice by most "malicious actors" in their transactions linked to crypto security incidents in the first quarter of the year, a blockchain security firm revealed in a new report.

"Despite being sanctioned by OFAC [U.S. Treasury Department's Office of Foreign Assets Control], Tornado Cash was still used by malicious actors in the majority of incidents" tracked in Q1 2024, security-focused on-chain data analysis firm CertiK said in a string of posts on X (formerly Twitter).

Tornado Cash is an open source tumbler that runs on Ethereum Virtual Machine (EVM)-compatible networks. It "mixes" cryptocurrencies to obscure the digital assets' original source, which explains why it was chosen by most actors associated with 224 security incidents in Q1 2024.

A total of $69 million was laundered by threat actors through Tornado Cash in the first three months of the year, CertiK added.

News of Tornado Cash being used by malicious actors isn't new, although the latest data from CertiK may strengthen the case that crypto mixers are vulnerable to threat actors who want to give law enforcement a hard job in tracing their trail.

Blockchain intelligence firm TRM Labs said in an October report that while use of the mixer was "radically" reduced following the OFAC's sanctions. However, the company warned that "illicit actors are still looking to Tornado Cash despite the government's actions" due to the tool's obfuscating capacity.

Two of the mixer's founders were indicted by the U.S. Department of Justice for supposedly having helped North Korea launder billions through its service. Roman Semenov and Roman Storm were charged with sanctions violations and federal money laundering in mid-2023. Storm was arrested, while Semenov remains at large.

Storm was released on bail but his legal woes have proven to be weighing on his finances as he has called for donations to help fund his legal fees. However, even his fundraising efforts were dampened just this year.

GoFundMe shut down a fundraiser that was meant to help fund Tornado Cash's legal battle. The crowdfunding platform reportedly cited Term 22 of its Terms of Services as a reason for the fundraiser's termination, which says it can close projects that it deems are "unacceptable or objectionable" and may "expose GoFundMe, its employees or Users to any harm or liability of any type."

Earlier this month, Storm moved to dismiss the DOJ's criminal indictment, with his lawyers saying that the U.S. government "wrongfully concluded" their client's work on developing the software was enough to find him guilty of criminal conspiracy.