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- The U.S. court ruled the Treasury overstepped by sanctioning immutable smart contracts on Tornado Cash.
- Treasury lifted Tornado Cash sanctions but still warns about cybercrime and crypto misuse risks.
The US Treasury Department has officially lifted sanctions against Tornado Cash, a crypto mixer that has become a symbol of the privacy-regulation debate. For the crypto community, the news of the sanctions being lifted seemed like an uplifting moment following almost two years of controversy, legal drama, and global backlash.
As of press time, over the last 24 hours, the TORN token’s price jumped 27.25%, and swapped hands at about $10.83. For many, it’s proof that faith in privacy and decentralization is far from dead.
"we have exercised our discretion to remove the economic sanctions against Tornado Cash" – US Treasury pic.twitter.com/mxN6M1kyln
— zerohedge (@zerohedge) March 21, 2025
Court Ruling: Smart Contracts Are Not Property
Initially, the Tornado Cash case caused conflicts between blockchain developers and the government. The US government previously accused the service of being used to launder illegal funds, including those linked to a North Korean hacking group.
However, on November 27, 2024, the US Court of Appeals dealt a major blow to the government’s legal approach. Its ruling was clear: the Treasury Department had overstepped its authority. Smart contracts that are immutable—and run automatically—cannot be considered sanctionable property.
The ruling served as a reminder to the government that not everything in the digital world can be treated like a traditional asset.
Jailed No More: Tornado Cash Dev Gains Crypto Backing
On the other hand, the CNF reported in February 2025 that Alexey Pertsev, a developer of Tornado Cash, had been released from detention in the Netherlands.
He had earlier been condemned to prison and accused of money laundering. This release felt to the crypto community like an acceptance that creating privacy tools is not illegal. Many considered it a crucial first step towards fair trials for open-source developers.
Who’s Liable When Code Acts on Its Own?
Moreover, the easing of sanctions raises more issues about how governments should control dispersed, autonomous technology. Imagine creating an alarm app that runs on its own without your ability to alter it. Then someone turns it toward something sinister.
You are held responsible? Many developers and users of systems outside of single-party control are wondering about the boundaries of the fairness of the legal approach.
Regulators Still Wary of Cyber Threats and Crypto Abuse
Still, the Treasury Department is not lounging about. They still express worries about the possibility of state-sponsored hackers and the possible illicit use of internet resources.
They underlined that attempts to punish digital criminals will go on even if sanctions against Tornado Cash are being lifted. This implies that regulation of the crypto industry will still be tightened even if Tornado Cash has avoided the blacklist.
Market Cheers as Legal Win Fuels Crypto Confidence
TORN’s return to the green lane in the market also reflects one important thing: crypto investors and users respond quickly to legal decisions that support technological freedom. It’s not just about profit, but also about the values being fought for.
Those who have supported Tornado Cash don’t just look at the code but also the principles, the right to privacy and digital autonomy.
