Tornado Cash and Government Desperation

Almost precisely one year after the U.S. Treasury sanctioned the Tornado Cash project and tool itself, the U.S. Department of Justice (DOJ) took another monumental leap in the war on privacy by charging the founders of Tornado Cash with money transmission, money laundering, and breaking U.S. sanctions law. The rapidly expanding legal aggression against privacy tools for cryptocurrencies like Bitcoin and Ethereum is beginning to show clear signs of desperation by the U.S. government. If they can’t outright prevent the use of these decentralized and autonomous tools, they’ll instead turn to legal and regulatory pressure to leverage fear and uncertainty as chilling agents against the privacy-focused developer community.

The DOJ has shown themselves in the indictment to either be willingly manipulating the public by putting forward a false view of Tornado Cash, or simply not understand Tornado Cash at a fundamental technical level. To dispel the fog of war being placed by the DOJ in this indictment, let’s walk through what Tornado Cash is and how it works first.