The Treasury will Allow  Users to get Their Tornado Cash money Back

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Key Takeaways:

  • Using Tornado Cash is categorically prohibited, but interacting with its code is not, according to the US Treasury.
  • By requesting an OFAC license, customers can now legally withdraw their money from the private transaction application according to the new instructions.

U.S. citizens can withdraw money from Tornado Cash by following a set of instructions released on September 13 by the U.S. Treasury Department.

The U.S. Treasury Department closed down the mixing service Tornado Cash on August 8. Investigations into the matter revealed that the platform’s capabilities for transaction obfuscation were utilized to help launder money.

The Office of Foreign Asset Control (OFAC), the U.S. Treasury Department’s sanctions enforcement arm, updated its “frequently asked questions” (FAQs) guide on Tuesday to offer direction to the cryptocurrency sector on how individuals and organizations can continue to comply with sanctions against Tornado Cash, the Ethereum privacy mixer that was blacklisted last month on suspicion that North Korean hackers used it to launder money.

To perform transactions concerning the concerned virtual currency, “U.S. people or anyone conducting transactions within U.S. jurisdiction may request a particular licence from OFAC.”

The wallet addresses of the sender and the beneficiary will need to be provided by users as well as other information that is necessary to be provided “at a minimum” in order to complete transactions.

The crypto community reacted angrily to the sanctions, raising questions about everything from whether software could be penalized to how those who used Tornado Cash for legitimate purposes could get back any money that had been locked up in the tool’s smart wallets.

Last Thursday, three defendants with money in Tornado Cash filed a complaint against the Treasury Department, alleging that the sanctions had frozen their legally deployed funds. This claim may now be influenced by the existence of a withdrawal option.

Anonymous users expressed their opposition to the original sanctions announcement by “dusting,” or transferring a little sum of ETH using Tornado Cash to a number of different cryptocurrency wallets, including those of prominent celebrities.

These transactions would be subject to OFAC regulations, but the guidelines said that OFAC will not “prioritize enforcement” in this case.

The FAQs also acknowledged the fact that after the penalties were revealed, some people attempted to prank celebrities by giving them small sums of ether via Tornado Cash.

These restrictions must be followed by Americans. More generally, it is being urged that the crypto sector should contribute to the fight against illegal conduct, whether it stems from a nation-state or not, because “responsible innovation” calls for it. The Treasury is interested in continuing to discuss these problems with the virtual currency sector.

Citizens are not breaking any government sanctions by interacting with Tornado Cash’s open source code, claims OFAC. This aims to put an end to weeks of rumour and discussion on the scope of the sanctions and how they affect free speech.

Tornado Cash tweeted that all of the organization’s GitHub accounts and those of its contributors had been suspended; however, Johns Hopkins had saved a fork of the code on GitHub for use in instruction and research.

There have been recent rumours connecting the recently imprisoned Tornado Cash developer to the Russian FSB. Tornado Cash was allegedly being used to launder money in North Korea by the Notorious Lazarus Group, which prompted the U.S. Treasury Department to sanction the business earlier this month.

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Aadrika Sharma
Aadrika Sharma

I enjoy writing and try to learn new things every passing day!

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