
Today in crypto, a US court in Texas has overturned Tornado Cash sanctions, President Donald Trump pardoned Ross Ulbricht, and the US securities regulator announced a Crypto Task Force, which will develop a regulatory framework.
US court overturns Tornado Cash sanctions in pivotal case for crypto
A US court has overturned the sanctions against the Tornado Cash cryptocurrency mixing protocol in a decision that could signal a shift significant toward more innovation-friendly regulations for privacy-preserving technologies.
The US Treasury’s Office of Foreign Assets Control (OFAC) originally sanctioned Tornado Cash in August 2022, accusing it of facilitating money laundering by the North Korean Lazarus Group. The group was alleged to have laundered more than $455 million in stolen digital assets through the protocol.
The sanctions led to the arrest of Tornado Cash developer Alexey Pertsev, who was found guilty of money laundering by Dutch judges at the s-Hertogenbosch Court of Appeal on May 14, 2024. Pertsev was sentenced to five years and four months in prison for laundering $1.2 billion in illicit assets through the platform.
In a significant legal development, the US District Court for the Western District of Texas has reversed the OFAC sanctions, according to a Jan. 21 court filing.
The court ruling comes after six Tornado Cash users filed an appeal against OFAC’s sanctions.
The appeal, issued on Nov. 26, 2024, argued that OFAC overstepped its “statutory authority” by blacklisting Tornado Cash in 2022.
Trump pardons Silk Road creator Ross Ulbricht
US President Donald Trump gave a full pardon to Ross Ulbricht, the founder of the darknet marketplace the Silk Road, who had been in prison for 12 years and was set to serve a double life sentence plus 40 years.
“I just called the mother of Ross William Ulbright to let her know that in honor of her and the Libertarian Movement, which supported me so strongly, it was my pleasure to have just signed a full and unconditional pardon of her son, Ross,” Trump said in a Jan. 21 post on his Truth Social platform.
One of Trump’s campaign promises to the crypto community was to pardon Ulbricht on his first day back in office.
Several Bitcoiners had earlier expressed frustration with Trump for not following through on his promise to pardon Ulbricht on Jan. 20. Trump instead pardoned around 1,500 people involved in the US Capitol attack on Jan. 6, 2021.
SEC launches crypto task force led by Hester Peirce
The US SEC has taken its first step toward crypto regulatory clarity following former Chair Gary Gensler’s departure on Jan. 20.
According to a Jan. 21 announcement, the agency is creating a crypto task force dedicated to developing a framework for digital assets. The task force will be led by Commissioner Hester Peirce, dubbed “Crypto Mom” for her pro-crypto stance when it comes to regulation.
The task force was announced by Commissioner Mark Uyeda, who is serving as acting SEC chairman until the US Senate confirms the nomination of former SEC Commissioner Paul Atkins to serve the remainder of former Chair Gensler’s term.
“The Task Force’s focus will be to help the Commission draw clear regulatory lines, provide realistic paths to registration, craft sensible disclosure frameworks, and deploy enforcement resources judiciously,” said the financial watchdog in a statement.