Deep Dive Episode 243 - Is the Office of Foreign Assets Control's Sanctioning of Tornado Cash a Threat to the Future of Financial Privacy?
Regulatory Transparency Project's Fourth Branch Podcast
Tornado Cash is an open source, decentralized cryptocurrency tumbler that was introduced in 2019. The service allows users to mix identifiable Ethereum cryptocurrency funds with others, thus obscuring the trail back to the funds original source. On August 8, 2022, the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Tornado Cash, making it illegal for United States citizens, residents, and companies to receive or send money through the service. OFAC claims that Tornado cash is responsible for laundering more than $7 billion in virtual currencies, including money believed to be stolen by North Korea and criminal groups.
As opposed to sanctioning people, organizations, or particular addresses associated with rogue regimes, OFAC has sanctioned the code of Tornado Cash itself, causing critics to claim that OFAC has exceeded its statutory authority .
In this podcast, experts discuss OFAC’s blacklisting of Tornado Cash, potential litigation from opponents, and the broader implications for financial privacy, national security, and free speech.
Featuring:
- Paul Brigner, Head of U.S. Policy and Strategic Advocacy, Electric Coin Company.
- Michael Mosier, General Counsel, Espresso Systems
- Kevin Werbach, Professor of Legal Studies and Business Ethics at the Wharton School, University of Pennsylvania
- Moderator: J.W. Verret, Associate Professor of Law, Antonin Scalia Law School, George Mason University
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As always, the Federalist Society takes no position on particular legal or public policy issues; all expressions of opinion are those of the speaker.
