Liberty

Circuit

Tornado Cash

Tornado

<h2 id="key-points">Key Points</h2> 
<ul> 
 <li>As US Treasury’s sanctions against Tornado Cash smart contracts are deemed unlawful, this is a big win for privacy and crypto.</li> 
 <li>Coinbase stated that it is proud to have helped lead this important challenge.</li> 
</ul> 
<p>According to the latest official reports, a US Court ruled that the sanctions against Tornado Cash smart contracts are unlawful. Coinbase’s Chief Legal Officer, Paul Grewal, announced the win on social media, highlighting its importance for privacy and the crypto sector.</p> 
<h2 id="a-historic-win-for-crypto-and-liberty">A Historic Win For Crypto and Liberty</h2> 
<p>In a<a href="https://x.com/iampaulgrewal/status/1861549058797772874" rel="nofollow" target="_blank"> post</a> on X, Grewal announced that privacy has won, as today, November 27, the Fifth Circuit held that the US Treasury’s sanctions against the Tornado Cash smart contracts are unlawful.</p> 
<p>He noted that this is a historic win for crypto and everyone who cares about defending liberty. He also shared that Coinbase is proud to have helped lead this important challenge.</p> 
<p>According to Grewal, these smart contracts now must be removed from the sanctions list and US people will once again be allowed to use the privacy-protecting protocol. In other words, the government’s overreach will not stand anymore.</p> 
<p>He said that no one wants criminals to use crypto protocols, but blocking open-source technology because a small portion of users are bad actors is not something that Congress has authorized. These sanctions have reportedly stretched the Treasury’s authority beyond its limits and the Court agreed.</p> 
<p>Grewal continued and said that the Court rules that while the Treasury has the power to take action against property, the open source, immutable smart contracts at the core of Tornado Cash cannot be owned by anyone and they are “property” subject to sanctions.</p> 
<p><a href="https://crypto.ro/en/exchange/gdax/">Coinbase</a> appreciates the Court’s careful consideration in this matter, and looking ahead, the exchange will not relent in its efforts to advocate for clear, fair rules to foster innovation in the US and abroad.</p> 
<p>Grewal showed gratitude to Kannon Shanmugam, a lawyer focused on the Supreme Court and appellate litigation, and to Paul Weiss, LLP, a law firm for their work over two years.</p> 
<h2 id="the-win-comes-following-an-appeal-from-texas">The Win Comes Following an Appeal From Texas</h2> 
<p>The important results came in following an appeal from the US District Court for the Western District of Texas.</p> 
<figure id="attachment_53998" aria-describedby="caption-attachment-53998" style="width: 100%" class="wp-caption alignnone">
 <a href="https://crypto.ro/en/wp-content/uploads/2024/11/tornado.png"><img loading="lazy" decoding="async" class="wp-image-53998 size-full" src="https://crypto.ro/en/wp-content/uploads/2024/11/tornado.png" alt="Official Court documents " width="765" height="706" title="US Court Ruled That Treasury's 2022 Sanctions Against Tornado Cash Smart Contracts Are Unlawful 30" srcset="https://crypto.ro/en/wp-content/uploads/2024/11/tornado.png 765w, https://crypto.ro/en/wp-content/uploads/2024/11/tornado-300x277.png 300w, https://crypto.ro/en/wp-content/uploads/2024/11/tornado-750x692.png 750w" sizes="(max-width: 765px) 100vw, 765px"></a>
 <figcaption id="caption-attachment-53998" class="wp-caption-text">
  Official Court documents
 </figcaption>
</figure> 
<p>In 2022, OFAC sanctions Tornado Cash, the open-source, crypto trading software protocol that facilitates anonymous transactions by “obfuscating the origns and destinations of digital asset transfers.”</p> 
<p>The six plaintiffs-appellants, users of Tornado Cash, argued that the protocol’s inclusion on the SDN list exceeded OFAC’s statutory authority.</p>

US Court Ruled That Treasury’s 2022 Sanctions Against Tornado Cash Smart Contracts Are Unlawful

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