Claim $500Coinbase Says It Is Funding Lawsuit Against Tornado Cash Sanctions
Crypto exchange Coinbase on Thursday said it is funding a lawsuit brought by six people challenging the Treasury Department’s sanctions of Tornado Cash. Tornado Cash, often referred to as a crypto mixer, is an open source software running on the Ethereum blockchain. On August 8, the U.S. authorities sanctioned the crypto mixer for allegedly laundering money worth billions. The Office of Foreign Assets Control (OFAC) found activities of a U.S. sanctioned hacker group on the software.
Coinbase Now Supporting Lawsuit To Relieve Tornado Cash From Sanctions
The authorities accused the company of laundering funds related to cybercrimes in the country. They described Tornado as a virtual currency mixer that ‘launders the proceeds of cybercrimes‘. Tornado Cash preserves privacy by allowing users to deposit assets from one crypto address and withdraw them using a different crypto address. The OFAC had at the time accused the crypto mixer of laundering more than $7 billion in crypto assets since 2019. The authorities further said that a part of the laundered money was associated with a Korea based hacking group.
Meanwhile, Coinbase said that it is not favoring unlawful behavior but protested the ban on the technology as a whole. The crypto exchange felt a blanket sanction on open-source code could have a chilling effect on innovation. Sanctioning open source software not the best way to solve the issue, Coinbase explained.
“We have no issue with the Treasury sanctioning bad actors and we take a hard stance against unlawful behavior. But in this case, Treasury went much further and took the unprecedented step of sanctioning an entire technology instead of specific individuals.”
Did The U.S. Authorities Go Beyond Its Limits?
The crypto exchange argued in its blog that the Treasury department went much further in the case of Tornado Cash. The department took the unprecedented step of sanctioning an entire technology instead of specific individuals, it added. Coinbase indicated that the bad actors like the activities of North Korean hackers should have been curtailed instead of the sanctions. “We have no issue with the Treasury sanctioning bad actors.”
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