Tether Will No Longer Freeze Tornado Cash Addresses
- The action took effect on August 8, as indicated by the US Department of Treasury.
- The post stated that no OFAC-banned addresses have been requested to be frozen.
Tether said it is seeking guidance from authorities before deciding whether or not to freeze Tornado cash addresses. The recent US government penalty on virtual currency mixer Tornado Cash sounded alarm bells in the cryptocurrency sector.
The US Treasury has blacklisted Tornado Cash, an Ethereum-based currency mixer, on its list of Specially Designated Nationals and Blocked Persons (SDN). The punishment now prevents US investors from utilizing the chain of the coin-mixing service.
The action took effect on August 8, as indicated by the US Department of Treasury. Tornado Cash, a Coin Mixer built on Ethereum, has seen a surge in popularity and is used by many businesses to hide the origin of their transactions. In a recent blog post, Tether admitted that the corporation could be acting irresponsibly in locking down secondary market addresses.
Severe Criticism Over Sanction
Tether said in their blog post that there are situations when law enforcement has explicit orders not to prohibit particular suspected addresses since doing so may tip the suspects. Because of this, no more leads or suspects will be able to be nabbed.
The blog post adds that no OFAC-banned addresses have been requested to be frozen by U.S. authorities. Tether noted that even if the firm is not US-based, it nevertheless regards OFAC sanctions as a worldwide compliance mechanism. It further warned that if it were to freeze the addresses without any orders, it may obstruct the inquiry by several authorities.
Five days after the U.S. issued penalties on Tornado Cash, the Netherlands’ Fiscal Information and Investigation Service (FIOD) stated it had detained a “suspected” Tornado Cash programmer. Crypto enthusiasts and privacy campaigners denounced the arrest as a declaration of war on developers.
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