Circle, the creator of the USD Coin (USDC) stablecoin, has frozen more than 75,000 USDC in funds connected to the 44 Tornado Cash addresses sanctioned by the United States Treasury Departments Specially Designated Nationals and Blocked Persons (SDN) list. Tornado Cash is a dApp that hides the history of previous crypto transactions on the Ethereum blockchain. Presently, Tornado Cashs smart contract addresses hold an estimated $437 million in assets, including wrapped Bitcoin (WBTC), Ethereum and stablecoins. Due to this, issuers are expected to try and prevent such assets from being traded or redeemed. The digital currency mixers Ethereum and USDC smart contract addresses on the SDN list are hence not allowed for U.S individuals, businesses, and any other entity. Moreover, penalties for willful non-compliance could range from anywhere between $50,000 to $10,000,000 in fines along with 10 to 30 years in prison. To make matters worse, Tornado Cash&39s new sanctions could even complicate simple interactions like Gitcoin donations, project work, and withdrawing or depositing from smart contracts as they could all be interpreted as violations from now on.
