EFF speaks in defense of Tornado Cash, seeks more regulatory clarity

Electronic Frontier Foundation, a nonprofit organization defending civil liberties in the digital world, voices its concerns about the impact of OFAC listing on free speech.

Internet surveillance concept.

“The issues EFF is most concerned about arise from speech protections for software code and how they relate to government attempts to stop illegal activity using this code,” the organization stated in a blog post titled “Code, Speech, and the Tornado Cash Mixer.”

On August 8, the Office of Foreign Assets Control (OFAC), a sanctions enforcement agency of the U.S. Treasury Department, placed Tornado Cash on its Specially Designated Nationals and Blocked Persons list. From that day on, US nationals are strictly prohibited from dealing with the sanctioned service and must abstain from transferring any money or property through it. But there is a legal loophole that can be used to challenge OFAC’s ruling: Tornado Cash is not an entity but an open-source software.

According to EFF, the OFAC listing is “ambiguous,” as there is no clarity on what exactly was sanctioned. “Tornado Cash” could refer to several different things, namely Tornado Cash Classic, Tornado Cash Nova (beta version of the mixer limited to 1 ETH per transaction), the underlying open-source project published on GitHub, the name of the mixing software, the URL of its website, and the group of people behind the service.

EFF has contacted OFAC to determine what the regulator means by “Tornado Cash,” and hopes to hear back soon. Meanwhile, Coin Center announced it may challenge Treasury in court on the legal ground that the mixing service “is not a sanctionable entity,” which means that the agency potentially exceeded its statutory authority.

EFF also announced it would represent the case of Matthew Green, a computer science professor at the Johns Hopkins Information Security Institute, who made a fork of a removed Tornado Cash repository and shared it with the public for educational purposes.

“The First Amendment protects both GitHub’s right to host that code, and Professor Green’s right to publish [...] it on GitHub so he and others can use it for teaching, for further study, and for development of the technology.”