Blockchain Association & DeFi Education Fund Defend Tornado Cash
The case for Tornado Cash is gaining support from prominent crypto policy and advocacy groups. According to filings against the US Treasury Department, the Blockchain Association and the DeFi Education Fund have filed an amicus curiae brief in support of the plaintiff’s motion for partial summary judgment.
Tornado Cash was sanctioned by the US Treasury Department alleging that it helped the North Korean hacking collective Lazarus Group funnel around $7 billion in funds from various businesses. The is notorious in the crypto industry for . The resulted in the arrest of , its creator. August was Pertsev in the Netherlands on money laundering charges, sparking a public outcry.
In response to the widespread exploits, the sanction was imposed by the Treasury Department’s Office of Foreign Assets Control (OFAC) on last year, effectively placing addresses allegedly linked to the mixer on the Specially Designated Nationals and Blocked Persons list. Such a designation makes it illegal for US persons to interact with these addresses, under threat of significant fines and imprisonment.
Plaintiffs in the Tornado Cash case (Van Loon et al) allege that OFAC violated the Administrative Procedures Act (APA) by sanctioning an entity not subject to the sanction, violating users’ right to free speech, and depriving them of property (cryptocurrency held in the mixer) without due process. The motion for partial summary judgment on the APA violation and free speech counts was filed on April 5.
In their brief, the Blockchain Association and the DeFi Education Fund argue that Tornado Cash is software, not a person or property, and serves an important function to preserve user privacy.
“Typically, OFAC would not consider sanctioning neutral tools used by some people for illegal activities, it would sanction those who commit those activities. The same perspective should apply to OFAC’s action against Tornado Cash,” said Kristin Smith, CEO of the Blockchain Association .
The brief also elaborated on previous legal arguments presented for the Tornado Cash case, saying OFAC’s sanctions are “inconsistent with the law for yet another reason: the sanctions are arbitrary and capricious.”
The amicus brief reiterated its position in the following statement:
“Such tools allow users to regain privacy that would be available as a matter of course in other contexts, while retaining the benefits that come with using blockchain technology.”
The two organizations backing Tornado Cash are not alone, however, as crypto think tank Coin Center also filed a lawsuit against the Treasury in October, calling the sanctions “unprecedented and illegal.” Coinbase’s head of legal affairs Paul Grewal also came out in support of Tornado Cash, arguing that sanctions should “.” Coinbase released funding for the lawsuit.
According to court documents, a pretrial conference for the parties and their respective attorneys is scheduled for April 23.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial or other advice.
