El Salvador President Nayib Bukele took a victory lap on Monday after the Bank of England’s British pound rapidly depreciated against the dollar. The institution has since resumed quantitative easing. Its action marks a clear pivot that many in the Bitcoin community predicted central banks would be forced into months in advance. Bukele’s Callout Bukele tagged the Bank of England with a triumphant “Told you,” over Twitter, scoring over 14,000 like and 2000 retweets from his followers. His brief comment…
The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) has cleared up some rules pertaining to Tornado Cash.
While some helpful guidance and reassurance have been provided, many questions remain regarding the Office’s designation of the privacy tool.
- The Treasury reiterated that U.S. persons are no longer allowed to interact with Tornado Cash. However, anyone who had their funds trapped inside Tornado Cash prior to August 8th may apply for a license to retrieve them.
“OFAC would have a favorable licensing policy towards such applications, provided that the transaction did not involve other sanctionable conduct,” read its statement.
- Regarding dusting transactions, OFAC said its regulations technically will apply. “Dusting” is when certain addresses are “tainted” by unsolicited funds from the now sanctioned Tornado Cash contract.
- The day after OFAC sanctions were confirmed, an online troll sent batches of 0.1 ETH to numerous high-profile accounts. Some of the targets included Shaquille Oneil, Beeple, and Coinbase CEO Brian Armstrong.
- Thankfully for those individuals, OFAC “will not prioritize enforcement” against those violations.
- The treasury also clarified that merely transacting through Tornado Cash is prohibited. Researching and copying the project’s open-source code is still permissible, as well as including information about it in educational materials.
- Such clarification may come as a relief to professor Matthew Green – a cryptography researcher who republished Tornado’s code for educational purposes.
“The Tornado Cash example raises the prospect that the U.S. government may use sanctions to ban source code distribution and scientific speech,” he said at the time.
- Chainalysis – a blockchain intelligence firm that assists with tackling crypto crime – noted that many questions have still gone unanswered. For example, it’s still unclear whether it is permissible to use copied Tornado code for transacting.