The Treasury Department is facing push back from the cryptocurrency industry over sanctions imposed on a firm accused of helping to launder billions of dollars — with some funds going to North Korean hackers.
Earlier this month, the Treasury Department imposed sanctions on the virtual currency mixing firm, Tornado Cash, which allegedly helped to launder more than $7 billion worth of virtual currency since its creation in 2019.
Mixing services combine various digital assets, including potentially illegally and legitimately obtained funds, to keep the origins of the funds secret, including money that has been stolen.
In the weeks after the sanctions were announced, crypto firms, lobbyists and at least one lawmaker have come to the firm’s defense, saying the sanctions open the door to limiting Americans’ usage of privacy software.
Coin Center, a nonprofit crypto advocacy firm, says Treasury’s financial crimes enforcement arm “overstepped its legal authority” through its sanctions, which “potentially violates constitutional rights to due process and free speech.”
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