The legal battle between crypto advocacy group Coin Center and the U.S. Treasury Department over the controversial sanctioning of Tornado Cash has officially ended, marking a pivotal moment in crypto-related regulatory litigation.
In a post published June 7 on X (formerly Twitter), Coin Center’s director Peter Van Valkenburgh confirmed that the Eleventh Circuit Court of Appeals has dismissed the group’s long-standing lawsuit challenging the Treasury’s authority to sanction the Ethereum-based privacy tool. “This is the official end to our court battle over the statutory authority behind the TC sanctions,” Van Valkenburgh wrote, adding that the government “was not interested in moving forward and defending their dangerously overbroad interpretation of sanctions laws.”
Court Declares Case Moot After OFAC Reversal
The dismissal follows a Texas federal court ruling earlier this year that ordered the Office of Foreign Assets Control (OFAC) to lift the sanctions on Tornado Cash, citing legal overreach. The Treasury Department chose not to appeal, effectively nullifying the original OFAC designation and paving the way for the Eleventh Circuit to close the case.
“The government’s view is that OFAC’s rescission of the designation moots this appeal,” the court wrote in its filing. Coin Center agreed that the case would be moot once the Texas decision becomes final and unchallengeable.
OFAC originally sanctioned Tornado Cash in August 2022, alleging the decentralized mixer was used by the North Korean Lazarus Group to launder hundreds of millions in stolen crypto. The move sparked global controversy and criticism from privacy advocates, open-source developers, and crypto policy groups who saw it as a dangerous precedent.
Tornado Cash Founders Still Face Legal Pressure
While the Treasury sanctions are now rescinded, legal issues continue to surround Tornado Cash’s developers. Co-founder Roman Storm is scheduled to stand trial next week on money laundering and sanctions violation charges brought by the U.S. Department of Justice. Storm maintains that he and his colleagues did not intentionally aid criminals, emphasizing the platform’s open-source and permissionless nature.
Earlier this year, fellow co-founder Alexey Pertsev was convicted in the Netherlands on similar charges and sentenced to 64 months in prison. Though recently released, Pertsev remains under house arrest and is electronically monitored. A third developer, Roman Semenov, named in the U.S. indictment, remains at large.
The Coin Center case has been closely followed by digital rights advocates, who argue that targeting code developers and smart contracts sets a dangerous precedent. For now, the end of the appeal brings partial closure to a case that has defined the legal boundaries between privacy tools and government sanctions.
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