U.S. Treasury Pushes to Skip Final Court Ruling in Tornado Cash Case

The U.S. Treasury has argued that a final court judgment is unnecessary in the ongoing case against Tornado Cash, the controversial crypto-mixing service. This move has raised concerns within the crypto community about due process and regulatory overreach, as the case could set a precedent for how decentralized protocols are treated under U.S. law.

Treasury’s Argument: No Final Judgment Needed

The Treasury’s legal stance suggests that previous rulings and enforcement actions against Tornado Cash are sufficient, making a final court decision unnecessary. This comes after the agency sanctioned the protocol in 2022, citing its role in facilitating illicit financial activities, including alleged use by North Korean hacking groups.

The government’s argument rests on the claim that:

• Tornado Cash is already effectively restricted, as major platforms have complied with sanctions and blocked access.
• A final ruling would not change the enforcement outcome, given existing legal actions against developers and related entities.
• The case has broader national security implications, reinforcing the need for swift regulatory action.

Crypto Industry Concerns

The crypto community and legal experts argue that bypassing a final ruling could have serious implications, including:

• Erosion of legal clarity – Without a definitive ruling, the regulatory treatment of decentralized protocols remains uncertain.
• Potential overreach – Critics fear the Treasury’s stance could set a precedent for unilateral action against other open-source projects.
• Impact on privacy tools – The case raises questions about whether privacy-focused crypto services can exist without facing similar crackdowns.

While the Treasury seeks to move forward without a final ruling, legal challenges from crypto advocacy groups continue. Organizations like Coin Center have argued that Tornado Cash is merely software and should not be treated as a centralized entity subject to sanctions.

The case’s outcome could have far-reaching effects on how regulators handle decentralized finance (DeFi) and privacy-preserving technologies. Whether the courts push back against the Treasury’s position or allow it to proceed without further judgment remains to be seen.