Privacy, Compliance Management

US sanctions on Tornado Cash to limit privacy software use, crypto firms argue

Sanctions imposed by the U.S. Treasury Department on cryptocurrency mixing service Tornado Cash following alleged participation in money laundering schemes, including those of North Korean hackers, have been opposed by the cryptocurrency industry due to their potential limitations to Americans' access to privacy software, The Associated Press reports. Nonprofit crypto advocacy organization Coin Center noted that the sanctions are outside the legal authority of the Treasury's financial crimes enforcement arm, while Rep. Tom Emmer, R-Minn, who has received financial backing from Blockchain Association Executive Director Kristin Smith, emphasized the sanctions' impact on privacy. "My government has no business sanctioning my ability to use a software that protects my anonymity, especially when Im using it for legitimate purposes," said Emmer. The sanctions' negative effect on individuals leveraging crypto mixers for legitimate purposes was also emphasized by Smith. "I think we do need to have a conversation around privacy and empower law enforcement without undermining peoples ability to have private transactions," Smith added.

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