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Cryptocurrency non-profit advocacy firm Coin Center is exploring a court challenge after the US Department of the Treasury's Office of Foreign Assets Control (OFAC) sanctioned cryptocurrency mixer Tornado Cash, making it the first time US authorities banned a technology, not an entity.
The Washington, D.C.-based firm alleges that OFAC has overstepped its legal authority by sanctioning Tornado Cash. Coin Center wrote in a blog post that the action potentially "violates constitutional rights to due process and free speech, and that OFAC has not adequately acted to mitigate the foreseeable impact its action would have on innocent Americans." The firm continued:
"We intend to work with other digital rights advocates to pursue administrative relief. We are also now exploring bringing a challenge to this action in court."
Coin Center emphasized that unlike crypto mixing service Blender, which was indeed regulated by a group of people, it can't be said that Tornado Cash is a person subject to sanctions.
The advocacy firm said it would first seek to engage OFAC. Coin Center added it will also help innocent Americans who have funds trapped at listed Tornado Cash addresses. Should OFAC ignore Coin Center's position on the matter, the advocacy firm will begin exploring with counsel a court challenge to this action.
Earlier in August, OFAC sanctioned crypto mixer Tornado Cash for laundering over $7 billion worth of crypto since 2019. OFAC claims that the smart contract helped North Korean hackers Lazarus Group launder $455 million of stolen crypto. Moreover, Tornado Cash reportedly helped launder over $96 million from the Harmony bridge heist as well as $7.8 million from the Nomad bridge hack.
