Tornado cash was sanctioned for an alleged money laundering case by U.S. Treasury.
Following the U.S. sanctions, Alchemy and Infura have blocked Ethereum API access for Tornado cash users.
Both platforms are providers of infrastructure and crypto APIs and are the most recent centralised organisations in the cryptocurrency industry to ban authorised crypto mixers.
The action was taken in response to claims made by the U.S. Treasury that individuals and organisations had utilised the anonymity protocol to launder more than $7 billion worth of cryptocurrency since 2019, including the $455 million taken by the Lazarus Group, which has ties to North Korea.
Circle also froze USD coins funds held within Tornado cash’s smart contracts.
The co-founder of Ethereum, Vitalik Buterin, asserted that he donated to Ukraine using Tornado Cash.
He said that the goal was to safeguard receivers’ financial privacy so that their adversary, the Russian government, wouldn’t know the complete details of the transaction.
Unfortunately, Tornado was used for all the wrong reasons.
It served as a hub for anonymous hackers to launder money obtained through protocol flaws, particularly cross-chain bridges.
This year, funds worth more than $2 billion have been taken from these applications.
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