Tornado Cash Defies Sanctions: Sees 45% Surge in Deposits in H1 2024

Despite heavy sanctions imposed in 2023, Tornado Cash has experienced a significant rebound in platform activity during the first half of 2024. This resurgence indicates that demand for crypto mixing services remains strong despite regulatory efforts.

Tornado Cash Makes Strong Comeback

Blockchain analytics firm Flipside Crypto announced that the crypto mixer Tornado Cash received a total of $1.8 billion in deposits during the first half of this year. This is a massive 45% more than the total deposits received throughout 2023.

Crypto-mixing services have gained popularity in the market as they provide major privacy protection to users. Thus, they aim to protect one of the key ethos of the decentralized crypto markets. These crypto-mixing services pool funds from different transactions before distributing them to the beneficiary thereby making it even more difficult to trace the original source of the funds.

The ugly side to this is that mixing services like Tornado has become a preferred venue to launder the ill-gotten said. Reportedly, the WazirX hacker used Tornado Cash to spin off $230 million in stolen funds. Because of this reason, regulatory bodies have been cracking down hard on these services.

After discovering that North Korean hackers used Tornado Cash to siphon $455 million in illicit funds, the Office of Foreign Assets Control (OFAC) sanctioned the crypto mixer. These sanctions imply that anyone interacting with Tornado Cash will be placed on a blacklist, preventing their wallet from being accepted by legally compliant crypto exchanges.

Also Read: WazirX Hacker Acquires Additional 43,799 Ethereum Selling Other Altcoins

The Hacker’s Haven?

In recent times, crypto mixing services have seen huge inflows coming from major theft activities in the crypto space. According to Arkham Intelligence, the hacker behind last year’s $100 million Poloniex exchange theft has transferred $76 million to Tornado in the past two months. Similarly, the exploiters of the HECO Bridge and Orbit Chain have moved $166 million and $47.7 million, respectively, to the mixer this year. Speaking on the development, blockchain analytics firm Chainalysis said:

“Consistent with a general uptick in market activity, mixers have begun to see a resurgence in 2024. When looking at the growth of individual mixing services overall, we see that WasabiWallet, JoinMarket, and Tornado Cash have grown the most.”

Later this year, Tornado Cash founder Roman Storm will be facing a trial during the first two weeks of December in New York.

Also Read: Tornado Cash Developer Denied Release By Dutch Court