Suspected Tornado Cash developer arrested by Dutch police
A 29 year old has been arrested as a suspected developer of the sanctioned platform Tornado Cash.
The individual was arrested on Wednesday August 10th 2022 and is suspected of concealing criminal financial flows and facilitating money laundering with cryptocurrencies.
The authorities have released a statement with the full details.
This development comes after the US Treasury sanctioned and blacklisted the service on Monday.
At the time of writing, these are the only developments. However, multiple arrests have not been ruled out.
We'll update as soon as we have more information on the topic and hear of any future arrests.
What is Tornado Cash?
Tornado Cash is a Ethereum based crypto mixer.
Its open source software allows people who want to move money from one crypto wallet to another remain completely anonymous.
Tornado Cash uses a ZK-proof method to authenticate a transaction. It generates a random key to deposit your ERC-20 crypto funds and uses it to sever the on-chain link between wallets.
Which effectively means there's no easy way to trace where money was sent to or where it came from.
It's received a lot of negative press over the years as it's been the tool of choice for many scammers to launder their ill-gotten gains.
According to the press-release from the US Treasury, Tornado Cash has helped launder around $7 billion dollars.
How are people responding to Tornado Cash arrests?
The arrest of the suspected developer has caused uproar in the crypto community.
Many are saying this is overstepping from authorities and is the exact reason decentalization and is a step back from the world of owning your funds completely many want.
Others are defending the issue saying that, when 35% of your total business isillegal, something needs to be done.
This is yet another piece of negative press for the crypto and blockchain communities as a whole.
How this plays out is yet to be seen, but it has the makings of an important development for many other tools in the space.
What Tornado Cash arrests and sanctions mean for you
If you use Tornado Cash for any reason, these sanctions and arrests likely mean you're going to have to make do without this tool.
It could cause another mixer tool to arise, but if the authorities are so committed to shutting these tools down traders and investors might have to envision a world without any form of mixing services.
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