Heres Why Tornado Cashs Activity Didnt Cease Completely Post OFAC Sanctions
The Office of Foreign Assets Controls (OFAC) tryst with the crypto industry dates back to 2018 when it designated two Iran-based individuals of malicious cyber activity. There has been no looking back since. More recently, the bombshell announcement that the US Treasury Department banned American citizens from using Tornado Cash, has had industry leaders abuzz. While sanctions did reduce Tornado Cashs activity, a recent report by Chainalysis shows that it is not easy to “pull the plug” on a decentralized protocol. Affect of OFACs Sanction on Tornado Cash The blockchain analytics firm Chainalysis published a new informe highlighting OFACs increased efforts in targetting crypto activity and its effect on the Ethereum-based coin mixer, Tornado Cash. On-chain data before sanctions revealed that 34% of all funds sent to Tornado Cash originated from illicit sources, while illegal activity was concentrated on just crypto hacks and scams. For instance, the Harmony Bridge exploit last summer accounted for more than 65% of the mixers total stolen fund inflows during a period of 60 days before OFAC initiated sanctions against it. However, this pattern of isolated, unique events and most illicit funds came in brief spikes. This is in contrast to similar activity from services such as darknet markets which