> While engaging in any transaction with Tornado Cash or its blocked property or interests in property is prohibited for U.S. persons, interacting with open-source code itself, in a way that does not involve a prohibited transaction with Tornado Cash, is not prohibited. For example, U.S. persons would not be prohibited by U.S. sanctions regulations from copying the open-source code and making it available online for others to view, as well as discussing, teaching about, or including open-source code in written publications, such as textbooks, absent additional facts. Similarly, U.S. persons would not be prohibited by U.S. sanctions regulations from visiting the Internet archives for the Tornado Cash historical website, nor would they be prohibited from visiting the Tornado Cash website if it again becomes active on the Internet.<p>This is very reasonable! It balances economic sanctions around money laundering and transmittal with freedom of speech.
With FinCEN Notice 2020-2 it's clear that the US wants to treat crypto as foreign bank accounts to coerce disclosure but that severely limits the scope of regulation they can do as it would place public blockchains as strictly not being American jurisdiction, and it would make monitoring American activity on these blockchains outside of the scope of domestic agencies and spy agencies would not be legally able to spy on American activities on these blockchains. When you understand these facts it explains why the US pursued dubious NK sanctions over what would be a much stronger case of considering the Tornado Cash protocol an unregulated bank which it is. There is a very big technical and legal distinction between what centralized BTC mixers do with UTXOs to be considered laundering and how the Tornado Cash protocol exploits how ETH works on-chain to combine ETH in a single account without taking KYC.
Seems like a forced defensive move given the new Coinbase sponsored lawsuit.<p>Treasury would probably prefer these freedom aren't even given, but they'll lose on these points so badly that it's face-saving to concede first.
The discussions on this seem to be fixated on the implementation details, when lawmakers tend to focus on results.<p>The desired result is for people to stop laundering money for sanctioned groups. How the Ethereum network does that isn't of particular interest to the law (yet), but "it's not designed to let us stop that!" isn't going to be an excuse.<p>Somewhat related, I'm not sure how anyone didn't see this coming from a mile away.
I read the sanctioned SDN List. Am I reading incorrectly that if someone merely created a new TC instance with new addresses and website, it would not violate sanctions? I don't see the sanction list sanction the actual code, nor the execution of the code, but IANAL.<p>The SDN here just shows the associated addresses, the published contract instance, and tornado cash website, no?<p><a href="https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20220808" rel="nofollow">https://home.treasury.gov/policy-issues/financial-sanctions/...</a>