I am by no means a fan of Tornado and what it represents in the crypto community - I think crypto has enough cretins already.
But this is definitely a bit of a stretch to go after the creator(s) in this way. Reminds me of the US Gov trying to ban/limit all encryption. Didn't seem okay then and this doesn't seem okay now.
This is disingenuous. It's like responding to someone arguing for gun control with "all the shooters drank water, should we ban that?".
We can argue about the legit/legal uses of Tornado Cash and whether it deserves to be sanctioned - but do so in good faith rather than pretending like it is equivalent to a general purpose tool like Microsoft Windows.
The tweet is very low information for me to comment. I can't tell whether these people contributed to Tornado cash before/after the sanctions were in place.
I think a fairer analogy would be, some devs contributed to signal, signal or a derivative of it got used by North Korea/Terrorist/current enemy of choice of the political class. Do we go around and delete the developers GitHub accounts?
Having never used tornado.cash or much of crypto (apart from making some money doing spot trades) I can't comment on what the good use cases are. Here's a sample thread of Vitalik claiming to use Tornado.cash to donate to people in Ukraine https://twitter.com/VitalikButerin/status/155692560223356928.... I can find some other threads like this on Twitter.
This is just another case of Government choosing "security" over privacy and should be scary to folks on HN than be cheered upon.
As a side, I am not sure whether Tornado.cash was marketed specifically for "bad" use cases. In the example below I'd support the DoJ in fining & imprisoning a software engineer for his visit to Pyongyang https://www.justice.gov/opa/pr/us-citizen-who-conspired-assi...
That's a false equivalence and you know it. A browser and a coin mixer have 2 very different core audiences, aiming to do very different things. I don't know anyone who has legitimate uses for a coin mixer other than laundering/covering their tracks.
I don't have particular vitriol against Tornado itself, they do offer compliance tool and seem to have just been an eventual outcome in crypto.
I do however have an issue with the incredibly high rate of money laundering etc that flows through crypto. Particularly so with Tornado cash. It's the 'go-to' for easy money laundering.
And no that's not a 'general ignorance' it's just a bi-product of having decentralized systems, it's not for me. That doesn't mean people are ignorant of it.
Edit: It really irks me this "oh you just don't get it" from some people. It's unproductive and from my own experience, incorrect. They give crypto supporters a bad name.
Tornado cash is not money laundering. It just isn't. Please stop claiming that.
If it were money laundering, you would be able to purchase a house with the money you made from drugs and then mixed through tornado. You can't. It's indistinct from having cash you made from selling drugs.
You still need to create a fake business to launder your money the old fashioned way if you want to have a legitimate origin for your money. Tornado does not launder your money. Claiming the origin of your money is tornado and nothing else is akin to claiming the origin of your money is cash you found on the street or something.
> Tornado cash is not money laundering. It just isn't. Please stop claiming that.
If I deposit 200k USD into my bank account which came from Tornado.cash - They will ask for proof it came from there.
Tornado cash will confirm this with their compliance tools etc. However as to where it came from before is in practice today impossible to identify.
The bank // IRS whoever may suspect something bad, but unless they can prove it, and I pay taxes on it, then that money is considered clean.
All one would need to say is - I lost my original wallet(s) when I slowly dripped it from a few old accounts I had when I was mining back in the day into Tornado.
I'm sure there are other clever ways cretins will come up with too but thats just off the top of my head. A very effective annonomizing tool helps that.
I'm not condoning it, I just don't think you should be too naive to believe its not happening.
> I do however have an issue with the incredibly high rate of money laundering etc that flows through crypto.
Incredibly high relative to what exactly? The total exchange volume of the cryptocurrency industry? Can you show some figures to back that assertion? OR are you talking relative to the global economy? In that case, it's not even a drop in the bucket.
Clearly the Tornado Cash team should have simply started a bank instead, then they would only need pay a fine and carry on.
> You simply can't argue that money laundering isn't rampant on cypto currencies.
Actually, I can quite easily argue that. Neither of your sources give evidence or numbers that justify your assertion.
In fact, less than 1% of transactions are shown to be illicit activity, and the majority of that is scams, not money laundering. Here's a report from your 2018 source, CipherTrace, only using more recent data: https://ciphertrace.com/2020-year-end-cryptocurrency-crime-a...
I quote:
> Cryptocurrency, with its similar characteristics, may likewise struggle to ever completely shake its bad reputation, despite illicit transactions making up less than 0.5% of Bitcoin’s yearly volume in 2020.
A more important clarification, which is precisely the reason I used blockchain instead:
Crypto != cryptocurrency.
You conflate the two several times across this thread, they are not the same.
With that aside, I'll ask again. Can you show some figures that back your assertion that there is a "high rate of money laundering flowing through crypto[currency]"? I would assume not, given that the very firms actively working with regulators and monitoring this activity disagree with that assertion.
I'm not going to be argumentative here, but the last article you referenced. Clearly coinbase would have a bias to promote userbase.
That said :
> Of that small portion, scams make up the overwhelming majority of cryptocurrency related crime.
How do you think those scams will cash out ? Next step - Places like Tornado.
> From 2017 to 2020, criminal economic activity was overwhelmingly conducted through traditional financial institutions.
This is apples and oranges. But a good number to put on paper when promoting a cryptocurrency exchange for sure.
There is just an incomparable amount of traditional fiat currency compared to crypto currency so how someone would even make that argument says a lot.
> Myth #2: More illegal activity takes place using cryptocurrency than with cash.
I have no idea what sincere person would say that myth was true unless it was said as a joke. So no argument there but again, not adding any value. See above comment.
> Myth #3: Cryptocurrency makes it harder for law enforcement to investigate malfeasance.
And the 'Facts' given ignore services like Tornado.cash. Conveniently wouldn't you agree ?
My personal opinion of the CoinBase article is "Shill out of Ten".
It does help when you check the numbers before making your assertions.
> Clearly coinbase would have a bias to promote userbase
You discount the post because it is from Coinbase, yet every point made is backed up with up-to-date sources from firms you have already deemed appropriate, such as CipherTrace and Chainalysis. That's an... interesting perspective to hold. A bit of cognitive dissonance going on there, methinks?
> How do you think those scams will cash out ? Next step - Places like Tornado.
From your own sources, usually exchanges which implement KYC/AML policies equivalent to traditional banks. Did you actually read them or do you just plop a few keywords in Google and hope for the best?
> And the 'Facts' given ignore services like Tornado.cash. Conveniently wouldn't you agree ?
> However, in spite of the money laundering risk associated with cryptocurrency mixing
services, tumblers are used for lawful activities more often than for illegal ones.
You don't seem interested in a rational or data-driven discussion so there's little fruit to harvest here, I'll leave you to your imaginings.
I think we have two different opinions on a side topic of Money laundering in regards to Tornado.
The original OP is the US Gov and GH overreaching and on that I fully agree.
I don't think your comments should be downvoted to oblivion at all. You definitely make some good points. I don't have all the real data in front of me so I'm just suspicious when there's a tool like Tornado.
But this is definitely a bit of a stretch to go after the creator(s) in this way. Reminds me of the US Gov trying to ban/limit all encryption. Didn't seem okay then and this doesn't seem okay now.