Alleged developer of crypto mixer Tornado Cash arrested – TechCrunch

The Dutch government agency responsible for investigating financial crimes said it had arrested an individual suspected of being a developer of the US-sanctioned software. Tornado Cash crypto mixing service in a move that has rattled some crypto and privacy advocates.

The Tax Information and Investigation Service said friday that the arrested 29-year-old is suspected of being involved in “concealing criminal financial flows and facilitating money laundering” through the popular crypto mixing service.

“Multiple arrests are not ruled out,” he said. The agency added that it had arrested the individual in Amsterdam.

The move comes days after the U.S. government sanctioned Tornado Cash – a service that allows users to mask their transactions by mixing funds from different sources before sending them to the final destination – for its role in laundering billions of dollars worth of cryptocurrency through its platform.

Tornado Cash has been used to launder more than $7 billion in virtual currency since its inception in 2019, the US Treasury said. The platform was also used to launder stolen funds in the $600 million Ronin Bridge breach and $100 million Harmony Bridge compromise earlier this year, according to security firms.

At least $1.5 billion in proceeds of crime such as ransomware, hacks and fraud have been laundered through Tornado Cash to date, analytics platform Elliptic told TechCrunch earlier this week.

Crypto and privacy advocates criticized the Dutch agency’s move, arguing that traditional payment rails were used for far more laundering.

The action of the Dutch agency further illustrates the growing interest of authorities around the world in so-called crypto mixers. Earlier this year, the Office of Foreign Asset Control sanctioned Blender, another crypto mixing service.

The Dutch agency’s Financial Advanced Cyber ​​Team “suspects that Tornado Cash has been used to conceal large-scale criminal money flows, including (online) thefts of cryptocurrencies (known as crypto hacks and scams These included funds stolen through hacks by a group suspected of being associated with North Korea. Tornado Cash started in 2019 and according to FACT, it has since achieved a turnover of at least seven billion dollars,” he said in the statement.

In the aftermath of the US sanction, a number of companies, including GitHub, Circle, Alchemy, and Infura, suspended or terminated Tornado Cash-related accounts.

Tornado Cash’s TORN token fell to $13.7 from $16.5 on the news, deepening its decline this month. The token has fallen over 50% in the past seven days, according to CoinMarketCap.

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