Coinbase sues Treasury over Tornado Cash bans
Coinbase is supporting a lawsuit filed against the United States Treasury Department by customers of the Tornado Cash Ethereum (ETH) mixing service.
Six individuals, including two Coinbase employees, filed the case, the firm revealed in a September 8 blog post. According to the exchange, the defendants utilized Tornado Cash for lawful reasons.
Grewal, commenting on the exchange’s role in the case, said that the corporation is accountable for fostering the development of the cryptocurrency industry.
The complaint claims that the Treasury exceeded its authority by authorizing the software based on suspicions that it was used to launder money.
According to the plaintiffs, the government violated the First Amendment rights of the users by prohibiting them from using Tornado Cash, a service that promoted free expression.
In addition, Grewal indicated that Coinbase respects the Treasury’s role, but that the department has other tools to apprehend problematic actors than penalties.
Criticism against the prohibition on Tornado Cash
Following the imposition of the sanctions, the Treasury has been under intense scrutiny, with a portion of the cryptocurrency market doubting the rationale behind the action.
After the historic Terra (LUNA) meltdown, the CEO of cryptocurrency exchange Kraken indicated that the regulatory fines were a “knee-jerk response” to safeguard customers.
As a result, Microsoft-owned GitHub terminated the user accounts of contributors to the Tornado Cash project and removed the source code. However, professor of computer science at Johns Hopkins University Mathew Green re-uploaded the code for educational and research reasons.
In addition, after the arrest of Tornado Cash’s creator, Alexey Pertsev, the opposition to the ban intensified. A portion of the cryptocurrency industry contended that Do Kwon’s freedom rendered the arrest ironic. However, he has been blamed for contributing to the collapse of the ecology.
Also Read: SEC Chairman Gary Gensler Supports CFTC Supervision Of Non-Security Crypto