In other words: you can use a hot dog stand to launder money. But if you were to intentionally establish a hot dog stand for the purpose of laundering money, the government would be absolutely correct in seizing your stand.
Same goes for Tornado Cash. It was not designed for money laundering, although you could use it for that. If the US government finds cases of money laundering happening, take down the entities doing the money laundering instead of attacking a tool.
If you think Tornado Cash was designed for money laundering, please point us to the documents where this is mentioned. I've personally followed the development of the project, but never saw any mentions of money laundering at all, anywhere.
No one's going to advertise openly to the public "Assassination services here! Just call 1-800-KIL-THEM!"
And no one's going to put in public documents "we set up this company in order to facilitate money laundering."
Therefore, they intended it to be used to hide transactions from the US government. They could have also limited the service to not run on amounts larger than 10k?
Are you suggesting that there is no plausible reason to want financial privacy, outside money laundering?
By contrast, a hotdog stand is typically designed to cook and sell hotdogs and, in the rare instances where money laundering occurs, it's not a primary service the hotdog stand offers to clients, and will still get the owner arrested.
It does have other purposes, hiding transactions from the public, which I have used Tornado Cash for many times in the past.
> I used Tornado Cash (non-US citizen here) for hiding transactions from the public (not hiding from the government), and when I filed my taxes, I still accounted for everything that is stored there + transacted via Tornado Cash, just like I do for my bank account. Appendix contained instructions for how they could access the proof of my transactions and accounts to verify themselves.
Not sure why people think what I did should be illegal, I'm paying my taxes and declare everything just like everyone else, but somehow I shouldn't be allowed to hide my transactions from randoms on the internet?
You can do this. But it doesn’t come without risk.
If you kept using Tornado even after it was found Pyongyang used it to launder money, yes, you lose your money. It’s analogous to local law enforcement announcing a laundromat has been laundering money for the mafia, and then—months later–someone getting upset the clothes they dropped off have been seized. They may eventually get them back. But there is reasonable suspicion in the meantime.
https://www.icij.org/investigations/fincen-files/global-bank...
2) Because those are major, highly entrenched banks, they not only have the resources to ensure that stories about them engaging in bad behavior get swept under the rug (which doesn't mean "no coverage", but does mean they don't get covered as much as they might perhaps deserve), they also have the connections to make it very unlikely that they will face any kind of meaningful repercussions for this.
This is quite unfortunate, and a decidedly negative aspect of our current system. But the answer to it is not "so other companies like TornadoCash should be allowed to break the law with impunity, too!" It's "so we need to find ways to change our system so that we can genuinely hold accountable big banks and others who currently break the law with impunity."
This is what they’re doing. North Korea laundered money via Tornado Cash [1]. Authorities announced it and watched Tornado Cash do nothing. So it got sanctioned. Every other mixer is untouched.
[1] https://www.cnbc.com/2022/06/30/north-korea-likely-behind-10....
North Korea also used HTTP for navigating websites which helped them hack targets and also launder more money. Banning Tornado Cash is like banning the HTTP specification/IETF for that, instead of going after the group in North Korea doing the money laundering/hacking.
There was a team of developers earning compensation, hiring and firing. That’s more than just code.
Guns are quite literally just atoms. The context matters. Not all guns are illegal. But ones used to commit crimes will get lawfully seized. The code exists in context, and the developers’ actions and intentions are relevant. None of this is novel.
This is the kind of sociopathic irresponsibility that's too common in tech. "Oh, it's not my fault my lab-grown monster decided to terrorize the countryside!"
The hair you're attempting to split between "laundering" and "washing" does not exist in the financial world, and would not impress financial regulators.
It does to those who believe in financial privacy.
The government will not carve out a subset of crimes because of an unnecessary self-imposed restriction on financial privacy.
You can revoke that consent, as it is possible to become a citizen of no country, but I wouldn't recommend it.
But there is a collectively hashed-out social contract you accept by staying, and it should be of no surprise that the law takes that contract as table stakes and acts according to it.
Comparing your financial scheme to Jim Crow isn't the most distasteful thing I've seen on HN, but it's up there!
It's not my financial scheme, it's the social contract.
Comparing that to hiding your financial transactions so you avoid KYC is genuinely embarrassing.
Granted, that's assuming you're a valuable enough contributor to society that you'll find another country interested in taking you, one that won't similarly have expectations around "people in a society should pay taxes", but that's a you problem.
Or you can choose to live in a country that has a tax treaty with US; either way you get to deduct local tax rate paid so you're not double taxed.
Not true, this tool exists to provide privacy on an otherwise public ledger. Your tax assessor has no right to know about a transaction as soon as it occurs. A crime is only committed if you don't voluntarily declare it at a certain point in the future.
LE laziness and citizens conceding territory unnecessarily is creating a nanny state.