punishment The “sanctions” aimed at transaction cloaking providers like Tornado Cash cannot be completely ruled out. Even if it disrupts the service: Chainalysis, a blockchain analytics firm, reports
Back on August 8, the Office of Foreign Assets Control (OFAC) announced a sanction of Tornado Cash for money laundering crimes.
in the reportpublishOn Jan. 9, Chainalysis said the sanctions were only partially effective. The total inflows to Tornado Cash decreased by 68% in the 30 days after the sanctions took effect.
However, the company also emphasized that since Tornado Cash is a decentralized platform, smart-contract “Therefore, no individual or organization can It’s just as easy to ‘stop it’ as a centralized service.”
Chainalysis cites the Hydra black market as an example, which has had the opposite effect. As cryptocurrency inflows plummeted to zero after German police seized servers as a result of sanctions.
Chainalysis explains that while the sanctions applied to Tornado Cash have caused “front-end websites to be shut down, smart-contracts have been shut down.” Its still able to work as before. This means that everyone remains technically available at all times.”
“That shows the sanctions against decentralized services. It can only reduce incentives to use the service rather than cut it out entirely.”
According to Chainalsis, the illegal use of Tornado Cash is primarily associated with crypto-related hacks and scams. On average, about 34% of all inflows are attributed to such matters.
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