<\/p>\n
A US federal judge rejected six plaintiffs\u2019 claims that the government overreached in its sanctions against blockchain privacy software Tornado Cash<\/a>.<\/p>\n Last August, the US Treasury\u2019s Office of Foreign Assets Control (OFAC) accused<\/a> Tornado Cash of enabling hackers to launder $7 billion in cryptoassets since 2019 and imposed sanctions on the mixer.<\/p>\n However, six people contended<\/a> in a motion that the government shouldn\u2019t sanction the mixer, asserting it is software \u2014 and not a foreign \u201cnational,\u201d \u201cperson,\u201d or group.<\/p>\n Coinbase backed the lawsuit, aiming to delist Tornado Cash from OFAC\u2019s records and limit the Treasury\u2019s apparent overreach of its powers.<\/p>\n But in a filing<\/a> released Thursday, US District Judge Robert Pitman determined that Tornado Cash can indeed be classified as a \u201cperson\u201d under the International Emergency Economic Powers Act.<\/p>\n \u201cThe entity is composed of its founders, its developers, and its DAO,\u201d the judge said.<\/p>\n \u201cThe record sufficiently supports OFAC\u2019s determination that the founders, the developers, and the Tornado Cash DAO have acted jointly to promote and govern Tornado Cash and to profit from these activities.\u201d<\/p>\n According to the plaintiffs, smart contracts can\u2019t be considered property as they can\u2019t be owned. Moreover, even if deemed property, \u201cTornado Cash does not have a \u2018legal or equitable claim or right in property\u2019 to them,\u201d they argued.<\/p>\n But Pitman said: \u201cThe court finds that OFAC\u2019s determination that the smart contracts constitute property, or an interest in property, is not plainly inconsistent with the regulatory definition of those terms.\u201d<\/p>\n He also likened smart contracts to vending machines, noting they execute a specific, preset function.<\/p>\n \u201cThe fact that smart contracts do so without additional human intervention, like a vending machine, or that they are immutable, does not affect its status as type of contract and, thus, a type of property within the meaning of the regulation,\u201d he added.<\/p>\n Critics have argued the sanctions have a chilling effect and violate free speech rights of software developers, but the court rejected<\/a> that view.<\/p>\n One Tornado Cash developer, awaiting trial in the Netherlands for alleged involvement in money laundering, was detained for 8 months before being released<\/a> in April.<\/p>\n The court ruled in favor of the government on the matter through a summary judgment, and the case now is expected<\/a> to go to the Fifth Circuit Court of Appeals for review.<\/p>\n Get the day\u2019s top crypto news and insights delivered to your email every evening.\u00a0Subscribe to Blockworks\u2019 free newsletter<\/a>\u00a0now.<\/strong><\/p>\n Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can\u2019t-miss tweets and more from\u00a0Blockworks Research\u2019s Daily Debrief<\/a>.<\/strong><\/p>\n Can\u2019t wait? Get our news the fastest way possible.\u00a0Join us on Telegram<\/a>\u00a0and follow us on\u00a0Google News<\/a>.<\/strong><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":" A US federal judge rejected six plaintiffs\u2019 claims that the government overreached in its sanctions against blockchain privacy software Tornado Cash. Last August, the US Treasury\u2019s Office of Foreign Assets Control (OFAC) accused Tornado Cash of enabling hackers to launder $7 billion in cryptoassets since 2019 and imposed sanctions on the mixer. However, six people […]<\/p>\n","protected":false},"author":2,"featured_media":139614,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[230,225,221,227,226,228,229,60,223,224,222],"class_list":["post-139613","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptocurrency","tag-brave","tag-coinbase","tag-crypto","tag-decentralised","tag-decentralized","tag-decentralized-exchange","tag-erc-20","tag-featured","tag-meme-coin","tag-robinhood","tag-solana"],"_links":{"self":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/139613","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/comments?post=139613"}],"version-history":[{"count":2,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/139613\/revisions"}],"predecessor-version":[{"id":147649,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/139613\/revisions\/147649"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media\/139614"}],"wp:attachment":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media?parent=139613"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/categories?post=139613"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/tags?post=139613"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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