Overview

• The U.S. Treasury lifted sanctions on Tornado Cash on March 21, 2025, removing over 100 Ethereum wallet addresses from the Specially Designated Nationals (SDN) list.
• Sanctions were originally imposed in 2022 due to Tornado Cash's alleged role in laundering $455 million stolen by North Korea's Lazarus Group.
• A 2024 Fifth Circuit Court ruling determined that sanctioning Tornado Cash's immutable smart contracts exceeded the Treasury's authority under the International Emergency Economic Powers Act.
• The Treasury emphasized its continued commitment to combating illicit cryptocurrency activities, particularly those linked to North Korea.
• This policy shift highlights a broader regulatory strategy to target individual actors exploiting decentralized platforms, as seen in legal actions against Tornado Cash founders and developers.