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ARTICLE · 17 DECEMBER 2024

Fifth Circuit Rejects OFAC Sanction Of Tornado Cash Crypto Code

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Per the Fifth Circuit, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) exceeded the plain language of its statutory authority when it sanctioned Tornado Cash...

United StatesTechnology
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  • Per the Fifth Circuit, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) exceeded the plain language of its statutory authority when it sanctioned Tornado Cash, a popular cryptocurrency mixing service, for allegedly facilitating money laundering for malicious actors, including North Korea.
  • While recognizing that bad actors may take advantage of Tornado Cash for malicious cyber activities, the court held that the immutable "smart contracts" at issue do not constitute "property" under the International Emergency Economic Powers Act (IEEPA) because they are not capable of being owned and because no one can exclude others from using them.

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