Tornado Cash Blacklisted by the US Treasury Department

North Korean hackers used the mixer Tornado Cash to launder crypto funds tied to the Ronin Network attack.

Tornado Cash Blacklisted by the US Treasury Department

Using decentralized crypto-mixing service Tornado Cash has been banned in America by the Treasury Department. The Office of Foreign Assets Control (OFAC) added that those who interact with Tornado Cash or any of their Ethereum wallet addresses could face criminal penalties.

According to the Treasury Department, Tornado Cash was a key tool for the Lazarus Group. This North Korean hacker group was linked to the $625 million hack of Axie Infinity’s Ronin Network in March.

“Tornado Cash has been the go-to mixer for cybercriminals looking to launder the proceeds of crime, as well as helping to enable hackers, including those currently under U.S. sanctions, to launder the proceeds of their cybercrimes by covering up the origin and transfer of this illicit virtual currency. Since its creation back in 2019, Tornado Cash has reportedly laundered more than $7 billion worth of virtual currency.” a senior department official announced.

Blockchain analytics firm Nansen reported that after Ronin was hacked, the ETH deposits on Tornado Cash soared. In May and June 2022, the average amount of ETH deposits eclipsed 220,000, which represents a total worth of $220 billion to $660 billion.

OFAC sanctioned Tornado Cash’s donation address, a Gitcoin grants address, and a few USDC addresses, and a total of 40 addresses were put on the sanctions list. In addition, the sanctioned Tornado addresses were freezing over $75,000 worth of USDC.

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