Alleged Tornado Cash developer arrested in Amsterdam

Illustration by Alex Castro / The Verge

The 29-year-old man was arrested in Amsterdam for his suspected involvement in the development of Tornado Cash, a service that was banned by the US Department of the Treasury for its role in laundering money from large-scale hacking operations.

The announcement of the arrest was made by the Netherlands' Fiscal Information and Investigation Service. Multiple arrests are not ruled out as investigations into Tornado Cash continue, as the individual is suspected of involvement in concealing criminal financial flows. The suspect is going to be examined today.

The arrest of Tornado Cash in Amsterdam is an example of how global authorities are cracking down on the industry. The redistributing of funds makes it harder for law enforcement to track digital transactions.

According to the US Department of the Treasury, these companies have failed to address their use as illegal money laundered services. The service was added to the sanctions list by the DOT after it was found to be used by North Korean groups.

The response from advocates is that privacy is an important aspect of cryptocurrencies.

The US government unfairly targeted a tool that is neutral in character and that can be put to good or bad uses like any other technology, according to the coin center.

According to Jerry Brito and Peter Van Valkenburgh, it is not a bad actor who is being punished, but all Americans who wish to use this automated tool to protect their own privacy.

One user suggested that making donations to Ukraine was an example of a financial transaction that you might want to hide from authorities. Vitalik Buterin used Tornado Cash to donate to the cause.

I'll out myself as someone who has used TC to donate to this exact cause.

— vitalik.eth (@VitalikButerin) August 9, 2022