The recent delisting of TORN, the native token of privacy protocol Tornado Cash, from the US sanctions list has led to a significant surge in its price. Following the announcement by the Office of Foreign Assets Control (OFAC) on March 21, TORN experienced a remarkable 71% increase within 24 hours, reaching $12.9. This development has been warmly welcomed by the cryptocurrency community, who see it as a victory for privacy-focused technologies and decentralized finance (DeFi).
Tornado Cash operates as a decentralized protocol that enhances privacy for Ethereum users by allowing them to mix their assets with others in a shared pool before withdrawal, making tracking transactions more challenging. The protocol faced intense scrutiny and was sanctioned by OFAC in 2022 due to alleged misuse by bad actors, including North Korea’s Lazarus Group.
However, in a significant legal victory for Tornado Cash, a federal court in Texas ruled in January 2025 that the protocol’s smart contracts could not be subject to sanctions. The judge emphasized that the software was autonomous, could not be owned, and operated independently of any central authority. This autonomy and immutability mean that Tornado Cash cannot be shut down or selectively restricted, weakening OFAC’s case against it. The ruling highlighted that while privacy protocols can be misused, the underlying code itself is beyond traditional regulatory control.
OFAC’s decision to delist Tornado Cash reflects a broader reassessment of how financial sanctions apply in a decentralized and immutable environment. Despite this positive development, the US Treasury remains vigilant about money laundering, particularly by North Korean cybercriminals like the Lazarus Group. This state-sponsored hacking unit has been responsible for stealing billions from cryptocurrency platforms and allegedly using the funds to support North Korea’s nuclear and ballistic missile programs.
Treasury Secretary Scott Bessent emphasized the importance of securing the digital asset industry from abuse by illicit actors like North Korea to ensure US leadership in financial innovation and inclusion. The commitment to disrupting malicious cyber activities and enforcing sanctions against North Korea remains a top priority for the Treasury.
Overall, the delisting of TORN from the sanctions list marks a significant milestone for Tornado Cash and underscores the growing recognition of privacy-focused technologies in the cryptocurrency space. The legal clarity provided by the court ruling in Texas has strengthened the position of decentralized protocols like Tornado Cash, highlighting the importance of code autonomy and immutability in the face of regulatory challenges.