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After OFAC imposed sanctions against the well-known mixer Tornado Cash, it cannot be ruled out that other services will be blocked. Among the likely contenders for sanctions are CoinJoin, Samourai and Wasabi. The blocking of Tornado Cash caused a heated discussion in the cryptocurrency community.
The reaction to the ban on the mixer was mostly negative. Perhaps with the ban on the mixer comes a new stage of regulation of the entire cryptocurrency market, more stringent than it was before. And the first victim of the new order was Tornado Cash.
Why Tornado Cash was sanctioned by OFAC
According to representatives of OFAC, the cryptocurrency mixer helped hackers launder illegally obtained funds. More often it was used by criminals from North Korea, who hacked exchanges and protocols, and then laundered digital assets through Tornado Cash. Several people were detained, they are considered to be involved in the creation of the mixer.
Sanctions against the mixer caused a heated discussion in the cryptocurrency community. Some users believed that this decision was correct, while others are confident that the authorities are tightening the screws even more. Among those who spoke in defense of the developers was the creator of Cardano Charles Hoskinson. Charles Hoskinson went the other way, offering his way out of the situation.
What is Charles Hoskinson’s position on blocking Tornado Cash, and what does he propose?
Charles Hoskinson believes that it is necessary to change the strategy for the development of such services. It offers to create mixers with open source code. In his opinion, the fault of the developers of the Tornado Cash mixer is not, they just wrote the code, and others used the service for criminal acts. Therefore, it is best to create open source applications in such a situation.
How will the situation develop further after OFAC blocked Tornado Cash
A number of protocols and platforms have already begun to block wallets that are related to cryptocurrency mixers. OFAC may continue to initiate sanctions against mixers suspected of laundering illegally obtained money. For the regulator, this is an opportunity to strengthen control over funds in the cryptocurrency market.
And for the cryptocurrency community, this is a signal that control will be increasingly strengthened. However, hackers will always be able to find an opportunity to launder stolen finances, no matter how hard the financial and power state structures try. Most of all, law-abiding users suffer from such actions.
Author: Vadim Gruzdev, Analyst Freedman Club Crypto News
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