Topic: Tornado.Cash Sanctioned by the US (Read 708 times)

But he already dumped some of the tokens on the market... right?

So where does he get the authority to make a proposal?

Smart contracts are often hacked, so this is no surprise to me. But it's a good thing the hacker wants to undo the attack and make token holders whole again. This attack will only make the protocol stronger in the long run. That is if developers are willing to continue working on the project. They must be very cautious now that Tornado.Cash has been sanctioned by the US. Any interaction with the mixer would raise a red flag immediately.

It's a wild and crazy world out there, so we should expect the worst for crypto mixers in the long run. At least, we've got plenty of options to choose from. Who knows how long will Tornado.Cash last? Just my opinion

Well some more bad news for crypto mixer Tornado cash. It was hacked and hacker has made a proposal to undo his attack. The hacker wants the governance and decisions to be made by token holders. But there is some mixed views about this.

https://bitcoinist.com/hackers-exploit-sanctioned-mixer-tornado-cash/

A strong argument indeed. Let's see how this will unfold in the long run. I just hope crypto proponents win in their efforts of bringing privacy to all. It's not fair to "sanction" something that it's just code living on thousands of computers spread around the world. The US government can't seem to understand the difference between a decentralized protocol (eg: Tornado.Cash) and the person using the protocol itself. Just because North Korean hackers used the mixer to "launder money", doesn't mean everyone should be prohibited from using it.

At least, developers "forked" the Tornado.Cash project for the preservation of privacy and freedom. We now have Privacy Pools and several other alternatives to choose from. It's still possible to use Tornado.Cash by interacting with smart contracts directly, though. That's because it lives on a decentralized and censorship-resistant Blockchain (Ethereum) no one can take down easily (although the switch to PoS makes this subject to debate). Who knows if the US government ultimately gives up in its quest to bring down crypto/Blockchain tech for good? Just my thoughts

Off-chain solutions like Phonon and 0xMonero are the best privacy solutions. One day encryption will be cracked by AI and quantum computing and the only safe transactions are the ones that occurred outside the blockchain.

I have been saying this all the time about crypto space, it is one damn thing which was very excellent creation by Mr Satoshi. Today, it is suffering from hundreds of artificial problems that were created “later”. What I mean is simple, bitcoin was doing just great before centralised exchanges started growing in billion dollars industry overnight.

Slowly, they started inventing more projects, more ways to invest money such as ICO to fund alts.

Then came in so called mixers to get more privacy to the transaction and so called anonymous nature to their coins. First of all, bitcoin is already pseudonymous and there was no need of such system.

I believe this gave rise to devil minds who happens to start using these services for money laundering.
So this was supposed to happen.

https://beincrypto.com/tornado-cash-2-0-privacy-pools-money-launders-at-bay/
Tornado Cash 2.0: Privacy Pools Claim to Keep the Money Launders at Bay
In Brief
"Privacy Pools uses Zero-Knowledge Proof, through which users can explain that their withdrawals are not part of the illicit transactions.
The demo is at an experimental stage and has not been audited.
Privacy Pools may face regulatory challenges."
https://www.privacypools.com/

A few months ago, Coinbase backed a legal challenge to sanctions imposed by the US govt against Tornado Cash. Today the plaintiffs filed a motion for summary judgment, asking the court to reopen TC for all. Their arguments are simple but powerful.

https://twitter.com/iampaulgrewal/status/1643704641493020672

There may be a new Tornado.Cash alternative, but that doesn't mean it won't get sanctioned by the US government in the long run. Developers should've hosted the front-end interface on IPFS, just to ensure the new privacy protocol remains as censorship-resistant as possible. With a centralized domain tied to it, you can expect the US government to "shut it down" the same way it did with Tornado.Cash. Forks may show us the power of open source, but what matters is what mainstream governments think about it. And I'm pretty sure they won't allow people to gain privacy just like that, even if there are legitimate intentions behind it.

Governments often use the excuse that crypto mixers are used for money laundering and tax evasion, so expect further scrutiny down the road. Who knows if privacy within the crypto/Blockchain space will be eliminated for good? Just my thoughts

Anonymous, pseudonymous, private or confidential transactions are different things. And depending how the system is build, technically yes, that's basically what they are doing. But with zk not in a same way they are currently doing it.

Using privacy to escape aml regulations isn't going to be a thing in the future you can pretty much count on that. And if you have been following AML laws and FATF regulations that are tightening, you know i am not just making this up. At the moment, only reason for lack of these regulations is lack of sources as tracking isn't efficient enough. And obviously it isn't cheap.

But it's the truth. There's no in between. It's either private/anonymous or not.

I really wonder what happens when someone transfers "dirty' coins through the tool because one time they will. Do they block the funds? Raise an alarm to the feds that. "Hey folks! Here is an address with dirty coins!"

Logical approach. So many people seem to think that everything needs to be fully private and anonymous or there's no privacy. I honestly don't even get why they weren't using the selective privacy as that is one of the coolest things you can go with zk. I am actually excited about this and i am watching closely where this leads. Especially i am looking forward in what kind info are they required to verify.

This is a good alternative for now, but who knows, this government agencies will be at least again and will put a sanction so it's going to be very hard on whether we want to used it or not.

So it might be another ticking time bomb, just saying.

Nevertheless it's for the own good of crypto enthusiast who want's to have their own privacy.

https://decrypt.co/122522/tornado-cash-fork-privacy-pools
Tornado Cash Contributor Builds New Privacy Tool—And Hopes It Won’t Trigger the Feds
"Ameen Soleimani, an early contributor to Tornado, has created a fork that aims to be a better version of the blacklisted Ethereum coin mixer.

Users can still make anonymous transactions but there is the option to make it clear that the money being moved is not from something criminal—like a hack. The new app works just like Tornado Cash, but when users click the option to withdraw funds, they can generate a zero-knowledge proof which publicly shows they are not using a criminal blockchain address, but without revealing who they are."

Thanks for sharing this, mate. It's good to know there are numerous alternatives to Tornado.Cash, especially when the US government exceeded its authority. We need privacy tools to protect our utmost sensitive information. Just because Tornado.Cash is a mixer, doesn't mean it was solely used for illegal purposes. There were people that were using the tool for legitimate purposes. Sanctioning, or even banning a decentralized mixer, would be sending us a message that "privacy is a crime".

It's a good thing the OFAC came to their senses by separating the good actors from the bad ones. People can now ask for a license from such agency to withdraw their funds from Tornado.Cash. While this defeats the purpose of "No KYC", at least it's better something than nothing. We're going to have to see if governments (especially the US government) will escalate towards privacy coins and decentralized exchanges. Crypto/Blockchain tech is growing at fast pace in terms of popularity and mainstream adoption, so I wouldn't be surprised if there's further scrutiny from the government against the aforementioned tools. No one knows what the future holds for the crypto/Blockchain industry, so we can only hope for the best. Just my opinion

There are still 6 similar cryptocurrency mixers in the Ethereum ecosystem: RAILGUN, Buccaneer V3, White Ethereum, 0xTIP, Messier 87 Black Hole and Cyclone Protocol
https://www.elliptic.co/hubfs/tornado-cash-alternatives.pdf
"Elliptic’s internal analysis identifies Cyclone Protocol as the highest risk amongst the Tornado
Cash alternatives active today. Its high transaction limits, the relatively large liquidity of its
mixing pools and its ability to mix the token of a sanctioned entity (TORN) makes it a cause
for concern. It’s confirmed use to launder at least some proceeds of DeFi exploits, the large
amount of funds it has since processed and the apparent absence of its developer team to
address concerns only strengthen these risks.
Also scored “medium-high” is Buccaneer V3, which has not addressed any AML concerns
throughout its development. BV3 is unique to the other protocols as it takes the form of a
token, rather than a service. A main mitigating factor of BV3, however, is that it claims to utilize
technology that is currently being tested. Whether it lives up to the features and capabilities it
has promised remains to be seen – with several rival obfuscation protocols casting doubt that
it can.
The remaining protocols all have mitigating factors arguably significant enough to ward
off large-scale illicit use. RAILGUN, while popular, generates compliance reports and has a
partially doxxed development team, meaning that it will likely comply with any investigations.
Its technology has also been scrutinized by rivals. Messier 87, meanwhile, has actively stated
that it will comply with subpoenas and provide such reports to authorities. Finally, White
Ethereum and 0xTIP struggle with low mixing limits and low liquidity pools respectively, making
them unviable replacements for Tornado Cash-level obfuscation at present.
Elliptic will continue to monitor the post-Tornado obfuscation industry across Ethereum Virtual
Machine (EVM)-compatible chains and update both virtual asset businesses and investigators
when new risks emerge. To keep ahead of these risks and receive updates from Elliptic’s
Research & Investigation Team, sign up to Elliptic Connect and stay updated with our weekly
newsletter."
elliptic.co (C)

They shouldn't if the code can be changed by the devs anytime they want which is the case here.

There used to be a paper wallet service called, bitaddress or something. It was an open source and a highly trusted service. Then some other person bought out the domain/business and placed a spyware/malware inside the code. Lots of people got burned because of that.

They surely did trust the code.

But little they know, they should have read and understood the code everytime they used that service which is obviously impossible. Not only impossible, most of these users don't even know how to code.

People will just have to trust the code. Satoshi Nakamoto's identity was never known, yet people trust Bitcoin because of the way it was designed. Early crypto projects had anonymous developers behind them, but that didn't stop them from becoming highly successful in the long run. I wouldn't see any difference with non-custodial mixers (decentralized). Unfortunately, ever-increasing KYC/AML requirements has led the public to seek identifiable information about developers to help gain their trust. Developers who don't disclose their identities are quickly labeled as "scammers". I know that scams are fluent in crypto land, but not every project with unknown developers is actually a scam.

I believe it's best for mixing protocols to be created by anonymous developers in order to remain as censorship-resistant as possible. Governments can't hunt down developers if they don't know who they are. Tornado.Cash didn't prioritized censorship-resistance, so it quickly fell down the drain after the sanctions (even thought smart contracts are still accessible on the ETH blockchain). Most so-called "non-custodial mixers" rely on centralized infrastructure, so taking them down should be a piece of cake. Unless developers host the frontend interface on censorship-resistant networks like IPFS or ZeroNet, mixers won't be going anywhere soon. Just my opinion

The code may survive regardless of what happened to the devs but these mixers are private businesses. People won't automatically trust some random people that build the same service from the same code. Lots of mixing services came and went before. Most of them were scams. It will take lots of time before people start trusting them and that means a lot of lost time for those who need these services.

Mixing service yes is always doomed. but they will keep coming up no matter us banned or other gov want to banning him

behind mixing service is to get more privacy but nowadays no no for the beginning of the service mixer service has been used as money laundry.

hacker is bad we must add line of code that block if hacker try to mix their dirty money to avoid this kind sactioned