In a major win for crypto privacy advocates, a U.S. federal court has overturned its previous decision backing the Treasury’s sanctions on Tornado Cash. The ruling now blocks the Office of Foreign Assets Control (OFAC) from reinstating its original sanctions against the crypto mixer.
Coinbase’s Chief Legal Officer, Paul Grewal, shared the news on X, calling it a “Congratulations to the brave plaintiffs who had the courage to stand up to their own government for their rights under law.”
The court stated that OFAC’s actions violated the Administrative Procedure Act (APA), meaning the agency must follow proper legal steps before imposing sanctions in the future.
“OFAC is now legally prohibited from reinstating the original sanction,” Grewal wrote. While OFAC can still try to impose fresh sanctions, it must now fully comply with the APA.
Tornado Cash was sanctioned in 2022 for allegedly helping the North Korea-linked Lazarus Group launder stolen crypto. Despite the controversy, Grewal continues to advocate for blockchain transparency while defending user rights.
Interestingly, the court also criticized the Treasury for trying to drop the case after delisting Tornado Cash, calling it a move that left room for future re-sanctioning attempts.
This led to an almost 8% increase in Tornado Cash’s (TORN) value, which rose to $7.90. Grewal’s post also suggested that there would be more information, such as from the Ethereum 2.0 probe.
This case may set the tone on how other crypto projects will be handled under the laws of the United States in the future.
Also Read: Coinbase CLO Slams FDIC Over Crypto FOIA Lawsuit Delay
