Crypto Community Reacts to Tornado Cash Sanctions, Privacy Advocates Say ‘There Are Many Legitimate Reasons to Seek Financial Anonymity’ – Privacy Bitcoin News

The US government banning ethereum mixing service Tornado Cash and the enforcement that has followed has the crypto community in an uproar over the incident. A large number of crypto and privacy advocates have spoken out against the government’s actions so far, with the non-profit advocacy group Fight for the Future calling the ban “a threat to the future of financial privacy.”

Advocacy Group Fight for the Future Says US Government Threatens Financial Privacy – “There Are Many Legitimate Reasons to Seek Anonymity in Financial Transactions”

On August 8, 2022, the US Treasury Department’s Office of Foreign Assets Control (OFAC) sanctioned the Tornado Cash virtual currency mixer. The US government claims the application was used to allegedly “launder more than $7 billion in virtual currency since its creation in 2019.” Following the ban, Github contributors were suspended from the software storage platform, and on August 12, the Tornado Cash Discord server deleted.

We can add @discord to the shame list too since they clearly decided to go *way* beyond and ban the community run/run discord server. God forbid people even *discuss* the thing that was unjustly sanctioned…

— Micah Zoltu (@MicahZoltu) 12 August 2022

On the same day, Dutch law enforcement revealed that the Fiscal Information and Investigation Service (FIOD) arrested a 29-year-old unidentified person accused of developing Tornado Cash. A report originating from The Block Crypto’s Yogita Khatri says the unknown developer is Alexey Pertsev, according to statements his wife made after the arrest. “My husband didn’t do anything illegal,” the suspect’s wife told the reporter on Friday. Meanwhile, the entire crypto community and privacy advocates are outraged by the US government’s actions.

“Welcome to the war on code,” podcast host Cobie so on Friday.

The non-profit organization Fight for the Future published a statement about the US government’s actions against Tornado Cash. “Already the internet is feeling the chilling effects of this election: the open source code used to run Tornado.cash has been taken down from Github. And unfortunately, it seems that such an effect is exactly what the US government was seeking,” explains Fight for the Future’s blog post on the subject Fight for the Future adds:

Anonymity is not a crime, and there are many legitimate reasons for seeking anonymity in financial transactions. Privacy tools are important for, for example, activists in authoritarian states where disclosure of financial information can get someone imprisoned or executed.

“Same War, Different Battle”

Crypto developer and co-founder of Aragon Luis Cuende so: “I am at a loss for words. I’m short of breath. They arrested him for writing code. Write code. These terrorist organizations called traditional nations must be dismantled.” The Tornado Cash conversation struck a nerve with almost every vocal member of the crypto community. “Let’s remember that the export/use across borders of encryption itself was illegal in the US until 1996,” Shapeshift founder Erik Voorhees so. “Same war, different fight,” he added.

An incredible number of projects seem to go far beyond the *actual* requirements of the sanctions.

— nick.eth (@nicksdjohnson) 11 August 2022

Others mocked the US government for banning Tornado Cash as several financial giants have been accused of helping money launderers, but no bank chiefs have been arrested. “Luckily I’ve never used Tornado Cash to launder money,” one Twitter user noted in jest. “I use Deutsche Bank like a normal person,” the person added.

Attorney Jake Chervinsky told his followers that everyone should “pay close attention to the situation in Amsterdam, where a Tornado Cash developer has been arrested. It’s unclear if there are allegations of illegal behavior unrelated to writing code. If not , this threatens to be the start of Crypto Wars II,” Chervinsky wrote.

Larry Cermak asks: ‘Why is only Tornado Cash affected?’

Over the past 24 hours, the Tornado Cash topic has been a very topical conversation that extends far and wide on social media. “The Tornado Cash developer being arrested by the Netherlands’ FIOD is worrying news,” podcast host Stephan Livera wrote on Friday. “Imagine if road builders were arrested ‘because criminals use them?’ Or home curtain fitters? Wanting privacy shouldn’t be considered a crime.”

They arrested the developer of tornado cash. 🚨

I repeat: a man was arrested for writing code that served as a public good for people to maintain their privacy online.

They put a man in jail because bad people used his open source code.

This cannot stand in any free society.

— RYAN SΞAN ADAMS – rsa.eth 🦇🔊 (@RyanSAdams) 12 August 2022

The Block Crypto’s VP of Research Larry Cermak wondered why other crypto privacy techniques haven’t been targeted by the US government. “I think an interesting question to ask now is why only Tornado Cash is affected and other privacy projects like Coinjoin, Monero and even Zcash are still fine?” Cermak tweeted. “Is it just because Tornado was used last, or are there some other factors at play here? Just weird.” The crypto researcher added:

Anyway, the ability to write open source code and [the] average user privacy is among the most important principles in crypto. We must do everything we can to protect the developers who put their security at risk.

Fight for the Future explains that people who don’t want their financial history “monitored by governments, corporations, stalkers or other bad actors is a legitimate reason to seek privacy-preserving technologies online.” The Advokatgruppen’s blog post ends by saying:

We ask that the Treasury focus more carefully on targeting bad actors – rather than trying to criminalize the building and use of privacy tools or the simple act of writing or running open source code.

What do you think of the community’s reaction to the recent sanctions against Tornado Cash and the enforcement against developers and tools? Let us know what you think about this topic in the comments section below.

Jamie Redman

Jamie Redman is the news editor at Bitcoin.com News and a financial technology journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open source and decentralized applications. Since September 2015, Redman has written more than 5,700 articles for Bitcoin.com News about the disruptive protocols emerging today.