In an unexpected turn of events, a Dutch court has ruled that Tornado Cash developer Alexey Pertsev can question blockchain analytics company Chainalysis in his ongoing money laundering trial.
Detained in August 2022, Russia-born Pertsev was apprehended by the Dutch Fiscal and Information Service (FIOD) for allegedly aiding money launderers through the Ethereum-based decentralized mixing service, Tornado Cash. The service allows for several users to pool cryptocurrencies together, mix them, and obscure their identities and previous transactions.
He was released in April this year and returned home.
As he tries to clear his name of the money laundering charges against him, the court has granted Pertsev permission to question Chainalysis about its methods, albeit in writing, because of the role its data played in his arrest.
Chainalysis declined to Decrypt’s request for comment about today’s ruling.
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It’s been a bearish quarter for crypto hackers, a new report shows. Blockchain intelligence firm TRM Labs revealed that the industry saw a dramatic drop in the number of hacks in the first quarter of 2023 due to recovery efforts and sanctions placed on the Ethereum mixer Tornado Cash. The report states that hackers stole approximately $400 million from crypto projects across 40 attacks, representing a 70% decrease in money stolen compared to the same period in 2022. Meet the Sleuthing Firm Helpi...
According to Pertsev’s lawyer, Keith Cheng, explanations by the FIOD have proven unsatisfactory, citing entities that do not exist on the Ethereum blockchain.
The court in the Netherlands also announced a delay in the trial, with deliberations set to begin in 2024.
Tornado Cash was blacklisted last year and added to the U.S. Treasury Department's Office of Foreign Assets Control (OFAC) Specially Designated Nationals list, effectively banning American citizens from using the service.
Tornado Cash Governance Attacker Offers DAO New Lifeline—And an Expensive Lesson
Just days after taking over the project’s governance, the Tornado Cash attacker has submitted a new proposal to revert the damage they've caused. On May 18, the Tornado Cash DAO accidentally voted in the malicious proposal after failing to properly audit its contents. Tornado Cash is a privacy-preserving mixer on the Ethereum network. The attacker was then able to grant themselves 1.2 million TORN tokens, giving them control over the DAO. They then swapped 380,000 of the newly-gotten TORN tokens...
An official statement from U.S. regulators alleges the privacy tool has helped launder more than $7 billion dollars since its inception in 2019, citing North Korean attackers and other malicious actors.
This court case drew the attention of privacy and cryptocurrency advocates around the world, given it could set a precedent for programmers that design permissionless protocols and raising the alert for those working and maintaining open source software.
The protocol was also in the news earlier this week due to a malicious proposal that was accidentally voted in by the Tornado Cash DAO before anyone realized it contained malicious code.
