A group of Tornado Cash users has filed an appeal in federal court against a decision by the U.S. Treasury Department that upheld its decision to add the cryptocurrency mixer to its sanctions list. In a filing filed on November 13, attorneys representing the plaintiffs argued that the U.S. Treasury Department “extended its authority beyond recognition” in sanctioning Tornado Cash transactions. The appeal comes in response to an August ruling by a Texas federal judge who ruled that Tornado Cash could be sanctioned under the regulatory authority of the Treasury’s Office of Foreign Assets Control.
The plaintiffs argued that the smart contracts under Tornado Cash, as set forth in the lawsuit, are “immutable and ownerless” and do not comply with the U.S. Treasury Department’s sanctionable “ownership” regulation. The appeal also challenges the Treasury’s definition of “interest,” arguing that Tornado Cash does not have “lawful, equitable, or beneficial interest” in users’ smart contracts.
Coinbase general counsel Paul Grewal said in a Nov. 13 issue of X that he supports the plaintiffs’ efforts and indicated that the appeals court will carefully consider the case. The cryptocurrency exchange has been publicly supporting Van Loon and the other plaintiffs since the September 2022 trial.
U.S. authorities have also filed criminal charges against individuals related to Tornado Cash. The Justice Department indicted co-founders Roman Storm and Roman Semenov in August on charges of attempted money laundering, attempted sanctions violations and attempted operation of an unlicensed money transmitting business.
The plaintiffs argued that the smart contracts under Tornado Cash, as set forth in the lawsuit, are “immutable and ownerless” and do not comply with the U.S. Treasury Department’s sanctionable “ownership” regulation. The appeal also challenges the Treasury’s definition of “interest,” arguing that Tornado Cash does not have “lawful, equitable, or beneficial interest” in users’ smart contracts.
Coinbase general counsel Paul Grewal said in a Nov. 13 issue of X that he supports the plaintiffs’ efforts and indicated that the appeals court will carefully consider the case. The cryptocurrency exchange has been publicly supporting Van Loon and the other plaintiffs since the September 2022 trial.
U.S. authorities have also filed criminal charges against individuals related to Tornado Cash. The Justice Department indicted co-founders Roman Storm and Roman Semenov in August on charges of attempted money laundering, attempted sanctions violations and attempted operation of an unlicensed money transmitting business.