Congressman demands answers from Yellen on Tornado Cash sanctions

Crypto booster Congressman Tom Emmer is demanding answers from Treasury Secretary Janet Yellen for the agency's recent Tornado Cash sanctions.

The Republican from Minnesota took aim at the Treasury's Office of Foreign Assets Control, or OFAC, and its blacklisting of Tornado Cash as a sanctioned entity earlier in August in an Aug. 23 letter posted on Twitter. A mixer that helps obfuscate transaction details, Tornado Cash laundered more than $7 billion worth of virtual currency since its creation in 2019, the Treasury said. 

"These sanctions are unique, however, in that they were not levied against a person or an entity, but against 'privacy-enabling' code," Emmer wrote, alongside a flurry of questions requesting clarifications of the agency's actions.

His concerns reflected many of the points the cryptocurrency industry has brought up in the wake of the sanctions, which were the first toa smart contract address. Emmer is a co-chair of the Congressional Blockchain Caucus and has a long history as an advocate for the crypto industry. 

"How does OFAC intend to uphold the appeals process for the sanctioned addresses that have no ability to appeal the sanction to OFAC" as the addresses are smart contracts with no agency and cannot speak for themselves, Emmer wrote. "Given that the Tornado Cash back-end will operate unchanged as an anonymizing technology as long as the Ethereum network continues to operate, who or what entity did OFAC believe was reasonably responsible for imposing controls on the Tornado Cash blockchain contracts?"

As The Block reported last week, the Tornado Cash designations were just the latest in a long expansion of sanctions targeting crypto wallets and businesses.