Treasury Removes Tornado Cash From U.S. Sanctions
U.S. Treasury removed Tornado Cash from its sanctions list after litigation over whether immutable smart contracts could be treated as sanctionable property, creating a significant legal development for decentralized privacy software with implications beyond the Ethereum-based protocol itself.
On March 21, 2025, the U.S. Treasury Department formally removed Tornado Cash from economic sanctions. Treasury said the decision followed review of the legal and policy issues raised by applying financial sanctions to activity occurring within evolving technological and legal environments.
The action followed the Fifth Circuit's November 2024 decision in Van Loon v. Department of the Treasury, which held that Tornado Cash's immutable smart contracts were not 'property' under the International Emergency Economic Powers Act because they could not be owned or controlled in the ordinary sense. Tornado Cash itself is built on Ethereum, not Bitcoin, and the delisting did not resolve separate criminal cases involving people associated with the service.
The broader significance for Bitcoin history is the legal treatment of autonomous privacy software. Bitcoin has its own long-running disputes over mixers, noncustodial wallets, privacy tools, developers, and the distinction between software publication and operation of a financial intermediary. The Tornado Cash litigation became an important reference point in that wider argument over how sanctions law can reach immutable code.