There is the US Treasury Department Blacklisted 40 cryptocurrency addresses allegedly linked to controversial mixer Tornado Cash The department lists crypto addresses on the Office of Foreign Assets Control’s (OFAC) Specially Designated List. The protocol has faced some recent cyberattacks after the North Korea-affiliated Lazarus group allegedly stole $455 million.
OFAC blocked US residents from using Tornado Cash after linking 44 Ether (ETH) and USD Coin (USDC) addresses to the mixer.
Tornado received payments for facilitating criminal transactions
According to the department, some businesses and individuals have defrauded mixers of $7 billion worth of crypto assets since 2019. This is in addition to funds stolen by North Korean supporters The Lazarus Group. Tornado Cash has suffered recent hacking incidents, including a $100 million hack of Horizon Bridge in June and a $375 million wormhole attack in February.
Treasury Undersecretary for Terrorism and Financial Intelligence Brian Nelson commented on the situation. He noted that Tornado Cash, despite public promises of improved security, had failed to maintain regular controls to prevent fraudulent use of funds through the platform. The platform has become a channel through which threat actors launder funds, but no serious efforts are being made to address the situation, he said.
Nelson said Treasury will continue aggressive monitoring and sanctions against mixers that help fraudsters and threaten actors to steal digital assets.
Tornado Cash’s security measures are inadequate
In May, the Treasury Department took a similar decision against crypto-mix Blender.io. OFAC said the mixer processed a portion of the $620 million stolen from Oxy Infinity’s Rhone Bridge game earnings. The OFAC platform processed 25.5 million USDC and 173,600 ETH, both worth about $20.5 million. As a result, OFAC sanctioned the platform and barred US residents from dealing in them.
Last month, Tornado Cash announced that it had open-sourced its user interface code. Mixer said its site now has a compliance tool that ensures users show the source of their transactions. But despite these approaches, the Treasury Department believes that Tornado Cash is not doing enough to prevent fraudulent activity via the platform.