A legal battle over the U.S. government’s sanctions on Tornado Cash has come to an end after the Treasury Department reversed its position on the controversial crypto software tool. The decision led to the dismissal of an ongoing appeal filed by Coin Center Inc., a crypto policy advocacy group.
The U.S. Court of Appeals for the Eleventh Circuit granted a joint motion by Coin Center and the federal government to vacate a previous judgment and dismiss the case. The court had heard oral arguments in November 2023 but had not yet issued a ruling.
Tornado Cash, an open-source Ethereum-based privacy tool, was previously sanctioned by the Treasury’s Office of Foreign Assets Control (OFAC) for allegedly facilitating illicit transactions. The designation sparked a wave of criticism across the crypto community, with advocacy groups warning it posed a threat to software developers and civil liberties.
The dismissal of the appeal marks a notable shift in the regulatory landscape. While the legal challenge avoided a definitive ruling on the scope of OFAC’s authority, the case has raised lasting questions about how the U.S. government applies sanctions to decentralized technologies.