Security News > 2022 > August > U.S. Sanctions Virtual Currency Mixer Tornado Cash for Alleged Use in Laundering

The U.S. Treasury Department on Monday placed sanctions against crypto mixing service Tornado Cash, citing its use by the North Korea-backed Lazarus Group in the high-profile hacks of Ethereum bridges to launder and cash out the ill-gotten money.

"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," Brian E. Nelson, under secretary of the Treasury for terrorism and financial intelligence, said.

Specifically, the Treasury Department pointed to Tornado Cash's role in laundering over $455 million and $96 million worth of cryptocurrency stolen from the two heists.

"As a smart contract-based mixer, Tornado Cash is one of the most advanced methods available for laundering ill-gotten cryptocurrency, and cutting it off from compliant cryptocurrency businesses represents a huge blow for criminals looking to cash out," Chainalysis said.

The move makes Tornado Cash the second cryptocurrency mixer to be blocklisted by the Office of Foreign Assets Control following the designation of Blender.io in May 2022, also for its part in laundering illicit funds siphoned by the Lazarus Group and cybercrime cartels like TrickBot, Conti, Ryuk, and Gandcrab.

"Tornado Cash community tries its best to make sure it can be used by good actors by providing compliance tools for example," Roman Semenov, one of the co-founders of Tornado Cash, said in a tweet.

News URL

https://thehackernews.com/2022/08/us-sanctions-virtual-currency-mixer.html