News for hackers. Stuff that matters.
Re:U.S. Treasury sanctions virtual currency mixer Tornado Cash by JumpCrisscross on Monday August 08, 2022 @11:35AM (#32386780)
> Cash itself has never been sanctioned though?

Ethereum isn't being sanctioned. Tornado is. If you transact with Tornado, you're in violation of the law. If you don't, you're not, whether you use Ether or not.

> if the government said “we’re now keeping a database of cash serial numbers that are hereby banned” would everyone need to install the “cash checker” app and scan each bill they receive?

Law enforcement has long used marked bills [1]. The cash isn't "cancelled." If you randomly end up with one, you're fine, in the same way that if you unknowingly end up transacting with a wallet that transacted with a wallet that touched Tornado, you're also probably fine. But if your garage has a box of marked bills, or if your wallet did a big transaction with another wallet that does lots of Tornado activity, you're going to be on law enforcement's radar.

[1] https://en.wikipedia.org/wiki/Marked_bill#cite_note-4

Re:U.S. Treasury sanctions virtual currency mixer Tornado Cash by colinmhayes on Monday August 08, 2022 @11:40AM (#32386873)
I just don’t see how the government can go about proving you received the money because you sent to it a mixer vs receiving it from a seemingly legal transaction with someone else who mixed it. Especially with defi exchanges that I doubt will check if coins have been mixed.
Re:U.S. Treasury sanctions virtual currency mixer Tornado Cash by acdha on Monday August 08, 2022 @12:48PM (#32387899)
Flip that around the other way: you are identified having received a transaction at the end of a chain from some crime with serious consequences. Do you want to have to prove to their satisfaction that you had no knowledge of this and aren’t part of some cartel’s money laundering operation? Can you keep doing that each time you use a mixer or does that start to look like a pattern where they stop believing you? Is there anything in your life that is innocent but could be strung together by an ambitious investigator? (e.g. your roommate’s boyfriend is Colombian, now you’re both getting questions and I hope he’s not self-employed)

It’s that grind which is fatal for mixers, not unlike Tor exit nodes. Nobody _needs_ to use them except money launderers but they depend on benign traffic for concealment. Even most privacy-minded people are going to hesitate if it taints their ability to make transactions with regulated businesses and the less innocent traffic there is, the more likely it is that using one will attract scrutiny, accelerating that feedback loop since most people don’t want to deal with the risk even if they are totally innocent.

The other level to consider: this mentions DPRK. That means all of the intelligence agencies could be involved and that increases the odds that a mixer is compromised or even run by them as a honeypot. Think about how you can decide whether to trust one, and whether the odds are that you’re signing up for additional privacy invasion like the people who’ve used certain messaging systems or VPNs.

Re:U.S. Treasury sanctions virtual currency mixer Tornado Cash by concordDance on Monday August 08, 2022 @11:52AM (#32387057)
> If you transact with Tornado, you're in violation of US law.

Fixed it for you. There's a tendency, particularly in the USA for people to assume that their law is universal

Re:U.S. Treasury sanctions virtual currency mixer Tornado Cash by vkou on Monday August 08, 2022 @02:47PM (#32389370)
US law isn't universal, but it does apply to anyone who wants to interact with the US financial system. Which is most people doing business outside their country of residence, including most people using crypto.
Re:U.S. Treasury sanctions virtual currency mixer Tornado Cash by shakezula on Monday August 08, 2022 @12:01PM (#32387205)
You're being needlessly pedantic here. They implied US law because the article is by the U.S. Treasury.
Re:U.S. Treasury sanctions virtual currency mixer Tornado Cash by kube-system on Monday August 08, 2022 @12:02PM (#32387221)
That is quite a conclusion to jump to, rather than simply interpreting the word "the" as an article referring to the sanctions listed in this post.