Tornado Cash censorship: Aave freezes TRON CEO’s address and backtracks

Justin Sun wind ahead – After a stormy week for the cryptosphere, we thought the weekend would bring some respite. However, thehurricane which falls on Tornado Cashthe cryptocurrency mixer, is struggling to calm down.

Tornado Cash in the breath of US regulation

Tornado Cash is a DeFi application that allows its users to send and receive cryptocurrencies while maintaining their anonymity. The ethers are thus mixed, mixed with each other so that they are no longer traceable. This is called a cryptocurrency mixer.

The winds therefore rose on August 8 for Tornado Cash. L’Office of Foreign Assets Control (OFAC), an organization belonging to the US Treasury Department, has decided to attack the cryptocurrency mixer.

The latter is, in fact, a tool frequently used by public enemy number one across the Atlantic: the group of North Korean hackers Lazarus. Web hackers then use it to disperse stolen funds on blockchain protocols so as not to be found. It is, for example, in this way that the harmony hack fund were dispersed.

In this context, the American regulator therefore asked to freeze funds addresses receiving transactions via Tornado Cash. The community’s Discord server and website have been taken offline. The main cryptocurrency mixer developer was later arrested in the Netherlands.

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Justin Sun, CEO of TRON caught in the storm

Shaken by these strong and chilling winds for our freedom, some have decided in their own way to underline the absurdity of the Treasury sanction. Internet users then decided tosend transactions via Tornado Cash to public persons.

Justin Sun, the founder of the TRON cryptocurrency lending protocol, is one of those targeted. He thus announced on August 13 that he had received 0.1 ETH from Tornado Cash. His address was then blocked. Aave having followed the requirements of OFAC and the US Treasury.

“I am officially blocked by Aave since someone sent me 0.1 ETH randomly from Tornado Cash (…)”

Tweet from Justin Sun, CEO of TRON – Source Twitter

The reaction of the Aave protocol was however quick since 24 hours after the alert on Twitter, Justin Sun confirmed the unblocking of his address.

Tweet from CEO of TRON, Source – Twitter .

“My Aave account is back. Kudos to Twitter and Stani Kulechov and I’m a huge Aave fan! »

Aave for his part also communicated on the recent OFAC sanctions confirming in a thread on Twitter at the end of the day yesterday:

“After the OFAC sanctions decision on Tornado Cash, the team integrated TRM’s API, which filters and blocks addresses that interacted with TC contracts after the sanction. This integration was as critical as it was urgent. We have been made aware that the API may have included unaffected wallets in the blocklists, (…) including wallets that have received ETH “dusted” by third parties interacting with Tornado Cash contracts without consent. »

It therefore appears that the blocking of Aave addresses takes place from the platform’s website, exactly, its page front end. So let’s be reassured, the protocols linked to the application remain unchanged.

Zeal, authoritarianism? This situation is an illustration of a regulation that seems to be falling on cryptocurrencies. Exchanges and protocols such as DyDx, Infura or Alchemy, block all addresses that receive funds from the cryptocurrency mixer. So, the Tornado Cash mess could harm the ecosystem in general. Indeed, this authority used by protocols, under the yoke of the US Treasury, casts a chill over one of the fundamental concepts that led to the creation of Bitcoin, king of cryptocurrencies:anonymity, carried by the voice of influential and important people for the ecosystem such as Vitalik Buterin. For its part, facing the storm, the DAO Tornado Cash automatically announces a second round in this fight.

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