The U.S. District Court for the Western District of Texas has overturned the initial local court ruling against cryptocurrency mixer Tornado Cash, lifting previous sanctions against Tornado Cash by the Office of Foreign Assets Control (OFAC).
Accordingly, the federal court overturned OFAC’s decision to impose sanctions on Tornado Cash, finding that the decision violated the Administrative Procedure Act.
While this decision was welcomed by the cryptocurrency industry, Coinbase Chief Legal Officer (CLO) Paul Grewal also defended the decision as correct.
“A US court today said no to this nonsense and overturned the original court ruling. OFAC is now legally prohibited from reimposing the original sanctions. Congratulations to the brave plaintiffs who have the courage to stand up to their government for their rights under the law. We appreciate the court’s careful consideration.”
Following the overturn, cryptocurrency companies have also taken action, calling on the White House to drop the lawsuit against the Tornado Cash co-founder.
A number of crypto companies have sent a letter to White House crypto and AI czar David Sacks urging him to drop the criminal case against Tornado Cash co-founder Roman Storm, DL News reports.
They cited the Department of Justice (DOJ)’s recent announcement that it will not take legal action against developers of cryptocurrency mixers and wallets used in criminal activities.
The letter in question was signed by major companies such as Paradigm, Multicoin Capital, and 6th Man Ventures.
The investigation alleges Storm laundered $1 billion worth of criminal proceeds, violated U.S. sanctions and operated an unlicensed money transmitting business. Storm and her supporters argue that she has no control over how others use her Tornado Cash.
Following the court ruling, the price of Tornado Cash (TORN) increased by approximately 8% to $7.9.
*This is not investment advice.