OFAC’s Tornado Cash Ban Leads to Github Suspension and Blacklisting of Crypto Addresses Holding $437M – Bitcoin News

On August 8, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) officially banned the Ethereum mixing service Tornado Cash and all crypto addresses associated with the platform. Following the ban, Github, an internet hosting service for software and open-source code development, removed some Tornado Cash commitments and suspended some of the project’s contributors.

Tornado Cash Github contributors suspended by Github, ERC20 blacklisted for liquidity providers

Tornado Cash has become a hot topic in the cryptocurrency space following the U.S. government’s decision on Monday to ban privacy-enhancing ethereum mixing services. OFAC, the U.S. Treasury Department’s regulator, did not disclose the exact reason why Tornado Cash was sanctioned, but it is suspected to be due to a North Korean hacking group known as the Lazarus Group.

Colleagues at Lazarus Group allegedly used Tornado Cash to mix funds. On April 15, 2022, the official Tornado Cash Twitter account explained that it had blocked flagged Ethereum addresses listed on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN). “Tornado Cash uses [a] The Chainalysis oracle contract will prevent OFAC-approved addresses from accessing dapps,” the project’s social media accounts said at the time. The Tornado Cash Twitter account added:

Maintaining financial privacy is essential to preserving our freedom, however, violations should not come at the cost.

Now reports detail that developers contributing to the Tornado Cash codebase on Github have been suspended and some commits have been removed. Founder of Tornado Cash, Roman Semenov, explaining that his Github account has been suspended. “My Github account was just suspended. Is it illegal to write open source code now?” Semenov asked. according to For a Twitter user named “Bowtiediguana,” all OFAC addresses associated with Tornado Cash hold roughly $437 million in the likes of USDC and USDTbeside Ethereum And the same goes for WBTC.

Following the OFAC ban, Circle blacklisted all U.S. dollar coins (USDC) associated with the Tornado Cash platform. Bowtiediguana wants Tether and WBTC custodian Bitgo to do the same, as these ERC20 tokens can be frozen at the smart contract level. Defi educators also want ERC20 custodians like Bitgo to “suspend redemptions of tainted WBTC, rendering these tokens worthless.” Bowtiediguana added:

If liquidity providers don’t *immediately* withdraw liquidity from DEXs, they could end up as holders of blocked WBTC (and stablecoins) assets.

Ethereum proponents call OFAC ban ‘big brother attack on cryptocurrencies’

Meanwhile, after the ban, a large number of members of the crypto community discussed the actions of the US government. “I’m sure the bad guys will stop using Tornado Cash because it’s ‘illegal,'” Shapeshift founder Erik Voorhees wrote“Like they don’t use illegal weapons, smuggle drugs, or launder money illegally by any means they can find. Law-abiding Americans are the only ones who are hurt by this,” Voorhis added. Ethereum proponent Ryan Adams called the ban an attack on the cryptocurrency.

“Today, the U.S. approved ethereum addresses associated with a privacy service called Tornado Cash. Circle immediately froze USDC in those accounts. GitHub suspended Tornado contributors. If you’re waiting for Big Brother’s opening remarks to attack cryptocurrency, That’s it,” Adams said.Crypto proponents discussed other ideas such as Decentralized Github censorship-resistant and otherwise talked about About creating a “new instance of the tornado contract”.

tags in this story

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What do you think of OFAC banning Tornado Cash, an Ethereum hybrid? Let us know what you think about this topic in the comments section below.

Jamie Redman

Jamie Redman is the Head of News at Bitcoin.com News and a fintech reporter living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He is passionate about Bitcoin, open source code and decentralized applications. Since September 2015, Redman has written over 5,700 articles for Bitcoin.com News on the disruptive protocols emerging today.

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