U.S. Treasury Ends Sanctions on Tornado Cash Following Court Ruling

The decision reflects a strategic shift in regulating decentralized finance, focusing on individual actors rather than platforms.

The U.S. Treasury lifted sanctions on Tornado Cash on March 21, 2025, removing over 100 Ethereum wallet addresses from the Specially Designated Nationals (SDN) list.
Sanctions were originally imposed in 2022 due to Tornado Cash's alleged role in laundering $455 million stolen by North Korea's Lazarus Group.
A 2024 Fifth Circuit Court ruling determined that sanctioning Tornado Cash's immutable smart contracts exceeded the Treasury's authority under the International Emergency Economic Powers Act.
The Treasury emphasized its continued commitment to combating illicit cryptocurrency activities, particularly those linked to North Korea.
This policy shift highlights a broader regulatory strategy to target individual actors exploiting decentralized platforms, as seen in legal actions against Tornado Cash founders and developers.