The Treasury Department and the United States Agency for Foreign Assets Control (OFAC) are facing a civil action from investors over the ban on the Tornado Cash cryptocurrency mixer. According to the West Texas District Court, six people filed suit against the organizations. The plaintiffs are cryptocurrency investors who use the mixer for lawful purposes and therefore criticized the decision of federal agencies. The Tornado Cash ban has sparked outrage from the cryptocurrency community as censorship concerns arise. The six individuals decided to take the protest to the courts, alleging that the Treasury and OFAC had abused their power.
Tornado Cash ban is illegal, lawsuit says
According to the suit, OFAC overstepped its regulatory limits in banning Tornado Cash with plaintiffs claiming that neither agency can ban a “software project”. Furthermore, the suit also says that the Treasury and OFAC committed a direct violation of the First Amendment to the US Constitution, which guarantees freedom of expression. In the past, free software advocates have used the same argument to criticize the government’s ban on exporting software. In this regard, the plaintiffs claim that the majority of Tornado Cash users are law-abiding, ordinary citizens. The suit claims that these people have the right to engage in financial transactions privately, but the ban directly affects this right. In the lawsuit, users say the ban restricted plaintiffs’ access to their Ether (ETH) that are in the mixer. The lawsuit claims the funds were being used for legal and humanitarian practices, such as donations for the war in Ukraine. Therefore, the action calls for an end to the Tornado Cash ban. Apparently, the plaintiffs in the action have a strong ally: part of the employees of Coinbase, the largest US trading platform, is funding the civil action. Coinbase employees Tyler Almeida and Nate Welch appear as parties involved in the action. Joining them are Prysmatic Labs co-founder Preston Van Looon, angel investor Alex Fisher, and former Amazon engineer Joseph Van Loon.
Mixer ban for one month
OFAC’s ban on Tornado Cash took place on August 8, as CriptoFácil reported. According to the Treasury, certain individuals and groups were using the mixer for criminal activities. These activities include illegal financing and money laundering. While Tornado Cash itself is not criminal, its mode of operation creates a thriving environment for such acts. OFAC and the Treasury cited that hackers linked to the attack on Ronin used the software to hide the source of the stolen funds. OFAC banned all mixer addresses and banned US citizens and businesses from using the tool. Furthermore, Dutch police arrested Tornado Cash developer Alexey Portsev in the Netherlands shortly after the ban. This arrest has also received criticism and many people classify the act as arbitrary. Also Read: Google Cloud Becomes Axie Infinity Ronin Validator Also Read: Game Of Thrones Creators Will Release Free Version Of Their New P2E Game
