Dutch authorities arrest alleged developer of Tornado Cash

Dutch authorities have arrested a developer suspected of being involved in money laundering through the crypto mixing service Tornado Cas...



Dutch authorities have arrested a developer suspected of being involved in money laundering through the crypto mixing service Tornado Cash.

The Fiscal Information and Investigation Service (FIOD), a Dutch agency responsible for investigating financial crimes, has officially announcement Friday the arrest of a 29-year-old man in Amsterdam.

The man was allegedly involved in facilitating criminal financial flows and money laundering through the decentralized Ethereum mixer Tornado Cash, the authority said.

FIOD stressed that it was not ruling out multiple arrests in the case, noting that its Financial Advanced Cyber ​​Team (FACT) launched a criminal investigation against Tornado Cash in June 2022.

According to FACT, Tornado Cash was allegedly used to conceal large-scale criminal money flows, including crypto hacks and scams.

“These included funds stolen through hacks by a group suspected of being associated with North Korea. Tornado Cash started in 2019 and, according to FACT, it has since achieved a turnover of at least seven billion dollars,” the announcement notes.

The news comes shortly after the United States Treasury Department placed dozens of Tornado Cash addresses on sanctions list by the Office of Foreign Asset Control (OFAC) on August 8. Major cryptocurrency company and USD coin issuer, Circle, then froze 75,000 USDC tied to addresses approved by OFAC.

Due to the sanctions, he became it is illegal for any U.S. person or entity to interact with Tornado Cash smart contract addresses. Penalties for willful non-compliance can range from fines of $50,000 to $10,000,000 and 10 to 30 years in prison.

Related: Tornado Cash co-founder reports being kicked out of GitHub as industry reacts to sanctions

Based on Ethereum, Tornado Cash is a tool for users to obfuscate their crypto transactions to protect their anonymity by blurring the tracks of information on the blockchain. Co-founder of Ethereum Vitalik Buterin claimed that he used Tornado Cash to donate to Ukraine to protect recipients’ financial privacy.