Tornado Cash: suspected developer arrested in Amsterdam

A 29- year-old man has been arrested in Amsterdam for his alleged involvement in the development of Tornado Cash.

Dutch authorities have issued a 29-year-old man arrested in Amsterdam on Wednesday. He is suspected of being involved in concealing criminal financial flows and facilitating money laundering through cryptocurrency service Tornado Cash. This was reported by CNBC, among others.

The news of the arrest was announced by the Dutch Fiscal Information and Investigation Service (FIOD), which investigates financial crime in the country. The FIOD said that the person was “suspected of involvement in concealing criminal financial flows and facilitating money laundering”. The agency began its investigation in June. FIOD has not ruled out the possibility of multiple arrests in this case as investigations into Tornado Cash continue.

Only last Monday, the US Treasury Department approved the crypto mixer Tornado Added Cash to a list of sanctioned services. This means that all US citizens are now prohibited from interacting with the mixer. Tornado Cash’s US assets are also to be reported to the Office of Foreign Assets Control. The US sanctions followed allegations that Tornado Cash was helping to obscure billions of dollars in capital flows.

According to the US Treasury Department, crypto mixing service Tornado Cash has laundered more than $7 billion worth of cryptocurrencies. The laundered funds also included those that, according to the FBI, hackers stole from North Korea’s Lazarus Group in the largest known crypto heist to date. The hackers stole millions of dollars from the sidechain network Ronin behind the play-to-earn game in March this year 245 NFT crypto game Axie Infinity.

Tornado Cash

Mixer service Tornado Cash covered the tracks

Tornado Cash is a blockchain-based cryptocurrency blending service powered by Ethereum. By mixing cryptocurrency, the online service allows for the obfuscation of both the origin and destination of digital payments, increasing their anonymity.

CoinDesk pointed to speculation on social media that the arrested person could possibly be the developer Alexey Pertsev. According to a report by The Block, his wife would have confirmed this. She stated “that she was shocked by her husband’s arrest and is currently working with lawyers”. She stressed: “My husband has not done anything illegal”.

The arrest in Amsterdam once again confirms the increased global official action against Tornado Cash and other crypto mixers. In May of this year, the USA imposed sanctions on the blender service Blender.io. The use of mixers makes it difficult for law enforcement agencies to follow the digital trails that cryptocurrency transactions otherwise entail.

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