The US Treasury Department’s Office of Foreign Asset Control on Monday sanctioned crypto platform Tornado Cash, which North Korean hackers have used for laundering.
The sanctions interdict any Americans or American entities from using Tornado Cash. The government said the crypto platform has been beneficial to cyber-criminals, who have relied on it to launder $7 billion in crypto.
“Despite public assurances otherwise, Tornado Cash has repeatedly failed to impose effective controls designed to stop it from laundering funds for malicious cyber actors on a regular basis and without basic measures to address its risks,” said Brian Nelson, Under Secretary of the Treasury for Terrorism and Financial Intelligence, in a statement.
According to a separate estimate from TRM Labs, North Korea has laundered roughly $1 billion in stolen funds through Tornado Cash.
“Today’s sanctions against Tornado Cash is a watershed moment, not only for the crypto industry, but for financial sanctions writ-large as it targets, as, opposed to prior sanctions, a widely used mixing service and, potentially, answers the question of whether or not US regulators and law enforcement are going to tolerate the use of mixers to launder illicit proceeds,” Ari Redbord, head of legal and government affairs at TRM Labs, told Insider in emailed comments.
