Home Ethereum Vitalik Buterin says he used Tornado Cash to donate to Ukraine

Vitalik Buterin says he used Tornado Cash to donate to Ukraine

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Vitalik Buterin says he used Tornado Cash to donate to Ukraine

Co-founder of Ethereum Vitalik Buterin said he used Tornado Cash to donate to Ukraine, just over a day after the US Treasury Department blacklisted the crypto mixing service for facilitating money laundering.

Buterin’s comments were in response to a tweet from Jeff Coleman, co-founder of a startup called Counterfactual, who said such a donation is a “great example of a valid need for financial privacy” that Tornado Cash could facilitate.

“Even if the government where you live is fully supportive, you may not want to [the] The Russian government must have full details of your actions,” Coleman said.

The Office of Foreign Assets Control (OFAC) of the Treasury Department added Tornado Cash to its list of specially designated nationals on Monday, effectively banning all individuals and entities from using the service.

OFAC claimed that Tornado Cash has laundered more than US$7 billion worth of cryptocurrency since its inception in 2019.

Crypto mixers are services that allow users to feed crypto into a large pool and withdraw the same amount – minus a fee – to multiple wallets to hide the sources of the original tokens.

Advocates of crypto mixers claim that not all funds flowing through the services are illegal and some, including Coin Center research director Peter Van Valkenburgh, have gone so far as to call the ban unconstitutional.

During a presentation at ZCON3, Valkenburgh argued that banning the publication of software is a restriction on free speech and is therefore unconstitutional, as is banning otherwise legal transactions made to preserve one’s own privacy for political gain.

People in Russia and Ukraine have turned to cryptocurrency as a store of value, as the currencies of both countries suffered a major decline right after the invasion of Russia.

In Ukraine, activists and volunteers Groups have used cryptocurrency to raise donations to help fund a defense against Russian invasion amid severe strain on the country’s financial system.

Recognizing the potential of crypto to aid Ukraine’s defense and humanitarian efforts, Ukrainian President Volodymyr Zelenskyy signed a Virtual Assets Bill in March that legalized cryptocurrency.

Buterine says that his intention using the service was to protect the recipients, not itself, as the government of Russia – Buterin’s birth country – was already aware of its stance on Ukraine.

A recent report on crypto mixers by data aggregation firm Chainalysis found that the amount of funds sent to crypto mixers hit an all-time high of US$51.8 million in April this year.

In an interview with Forkast Last week – before OFAC’s decision – Kim Grauer, head of research at Chainalysis, said she thought it was only a matter of time before lawmakers intervened.

“Because of the seriousness of the situations and the bad actors involved, it’s really become almost obvious that law enforcement needs to address this issue,” Grauer said.

The Chainalysis report recommended that any regulation must strike a difficult balance between protecting the right to digital privacy it offers while addressing its obvious usefulness for illicit activity.

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