The mixers are essential components for cybercriminals that use them for money laundering, it was used to launder the funds stolen from the victims.
According to OFAC, Tornado Cash was used to launder more than $7 billion worth of virtual currency since its creation in 2019. The Lazarus APT group laundered over $455 million stolen during the largest known virtual currency heist to date. Tornado Cash was also used to launder more than $96 million of malicious cyber actors’ funds derived from the June 24, 2022 Harmony Bridge Heist, and at least $7.8 million from the recent Nomad crypto heist.
The sanction is being taken pursuant to Executive Order (E.O.) 13694.
“Today, Treasury is sanctioning Tornado Cash, a virtual currency mixer that launders the proceeds of cybercrimes, including those committed against victims in the United States,” said Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson. “Despite public assurances otherwise, Tornado Cash has repeatedly failed to impose effective controls designed to stop it from laundering funds for malicious cyber actors on a regular basis and without basic measures to address its risks.”
In May, the U.S. Department of Treasury sanctioned another cryptocurrency mixer, Blender.io, which was used by the North Korea-linked Lazarus APT to launder the funds stolen from Axie Infinity’s Ronin bridge. This is the first time ever, Treasury is sanctioning a virtual currency mixer.
“Virtual currency mixers that assist criminals are a threat to U.S. national security. Treasury will continue to investigate the use of mixers for illicit purposes and use its authorities to respond to illicit financing risks in the virtual currency ecosystem.” concludes the announcement published by the U.S. Treasury Department. “Criminals have increased their use of anonymity-enhancing technologies, including mixers, to help hide the movement or origin of funds.”
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(SecurityAffairs – hacking, Tornado Cash)