- Advertisement -spot_img
Monday, October 3, 2022

Was the US ban on Tornado Cash just a “first round” against the crypto industry? , opinion | bitcoin portal

This week, the US government shook the entire cryptocurrency world.

The US Treasury Department has approved the Tornado Cash cryptocurrency mixer, as well as a number of crypto addresses associated with the service. As such, the protocol and its autonomous contracts are now registered, making its use by US citizens illegal.

Tornado is a privacy tool that allows users to obscure the origin and destination of their funds. Basically, it turns the transparency of blockchain technology into a black box, hiding your crypto activity.

The US Treasury supported the initiative by indicating that the Lazarus Group, a hacking group with ties to North Korea, used the service to launder stolen cryptocurrencies (such as the $96 million stolen in the recent Harmony Network bridge attack). is using. ,

Overall, the US Treasury said the service has been used to “launder more than $7 billion in virtual currency since its inception in 2019.” However, all this money was not technically washedAccording to blockchain analytics firm Elliptic.

Nearly $7.6 Billion in Crypto passed on Of those funds, only $1.5 billion were illegally obtained (and laundered) by Tornado Cash, but according to a report from Elliptic.

Another blockchain monitoring company Chainalysis also reported that nearly half of that $7.6 billion came from the decentralized finance (or DeFi) sector — and none of that money, according to the company. Chainalysis is, essentially, illegal.

The cryptocurrency acquired by Tornado Cash, by source (Image: Chainalysis)

But now that the privacy service has been approved, the crypto community is up in arms.

Expert group Coin Center argues that the sanctions don’t necessarily target a specific terrorist group or anything, “but all Americans who want to use this automated tool to protect their privacy when transacting online, [mas] who are curtailing their liberty without any due process”.

Even Ethereum co-founder Vitalik Buterin accepted Have used Tornado (before the service was approved) to donate money to Ukraine.

In addition to a blatant violation of the right to privacy, the new restrictions have also had an interesting effect on the DeFi industry, which we are just beginning to notice.

Derivatives decentralized (or DEX) exchange dYdX almost immediately banned addresses associated with Tornado Cash. The bill even said that its “highly used compliance providers” – services provided by Chainalysis or Elliptic – came with a “sudden influx” of flagged accounts.

But many of those accounts, as dYdX acknowledged, “were never interacted with Tornado Cash.”

This is a shameful mistake, and it also shows how compliant some crypto projects want to be – even those that claim to be “decentralised”.

Meanwhile, on the more anarchist side of the industry we’ve come to love (and hate), there have been some interesting reactions to US Treasury sanctions.

For example, consider sending small amounts of Ether to various celebrities via Tornado Cash.

From its point of view, American presenter Jimmy Fallon may have technically breached the sanctions simply because someone sent him ether via Tornado. No one can block these transactions. They are truly unbeatable.

And thanks to the actions of the US Treasury, the world will soon learn just how powerful blockchain can be – and “fight it” sanctions.

* Article by Liam J. Kelly, editor of Decrypt for the “Decrypting DeFi” newsletter, which summarizes the most important events during the week in the decentralized finance sector.

**Translated by Daniela Pereira do Nascimento with permission Decrypt.co,

Want to invest in digital assets but don’t know where to start? The bitcoin market offers the best and most secure trading experience for anyone taking their first steps in the digital economy. Meet MB!

World Nation News Desk
World Nation News Deskhttps://worldnationnews.com/
World Nation News is a digital news portal website. Which provides important and latest breaking news updates to our audience in an effective and efficient ways, like world’s top stories, entertainment, sports, technology and much more news.
Latest news
Related news
- Advertisement -

LEAVE A REPLY

Please enter your comment!
Please enter your name here