Tornado Cash (TORN) just scored a major win against the U.S. government, dealing a blow to overreaching crypto regulation.
On April 29, 2025, U.S. District Judge Robert Pitman (Western District of Texas) issued a permanent injunction against the Treasury’s Office of Foreign Assets Control (OFAC), blocking it from reinstating sanctions on the crypto mixer.
The ruling strikes down OFAC’s original August 2022 designation of Tornado Cash as a Specially Designated National (SDN), which accused the protocol of enabling money laundering —including for North Korea’s Lazarus Group.
Tornado Cash vs. the OFAC
The court dismantled the Treasury’s case on several fronts. Judge Pitman ruled that Tornado Cash’s smart contracts are not “property” under U.S. law, making them ineligible for sanctions. This reinforced an earlier Fifth Circuit decision that had already weakened the government’s position.
OFAC tried to argue that the case was moot because it delisted Tornado Cash in March, as CryptoMode reported. The court didn’t buy it, however, and Pitman recognized the obvious risk that the Treasury could simply reimpose the sanctions at a later date, and locked them out with a permanent injunction.
The plaintiffs (led by Joseph Van Loon and backed by Coinbase’s legal team) successfully argued that treating immutable open-source code as sanctionable property grossly overstepped OFAC’s authority. A month ago, in February, Tornado Cash’s main developer, Alexey Pertsev, was released from Dutch prison, marking the end of the pretrial detention.
TORN Price Sees Modest Gain Following Court Ruling
The implications are massive. This ruling isn’t just a win for Tornado Cash — it’s a major precedent for DeFi, web3, and open-source developers. It throws a wrench into future attempts to regulate decentralized protocols by brute force and strengthens the legal shield around public codebases.
The market reacted, though cautiously. TORN, Tornado Cash’s native token, posted a decent gain after the news broke. As per CoinGecko data, the privacy token is trading at $7.8, a 6% increase in the last 24 hours.
The optimism is there, but the broader DeFi sector is still absorbing the full scope of what this legal victory means. The message is clear: open-source protocols aren’t fair game for lazy regulation anymore.
Disclaimer
This article is provided for information only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
