Kraken CEO criticizes sanctions against Tornado Cash

Jesse Powell noted that users “have a right to financial privacy,” and that many use crypto mixer for legitimate purposes

17.08.2022 - 11:50

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What’s new? The CEO of cryptocurrency exchange Kraken Jesse Powell has criticized the US Office of Foreign Assets Control (OFAC) sanctions against cryptocurrency mixer Tornado Cash. Powell noted that users “have a right to financial privacy” and that many use Tornado Cash for legitimate purposes. He said this in a conversation with Matt Miller and Kailey Leinz on Bloomberg Crypto.

Information on the Bloomberg website

What else did Powell say? He also expressed doubt that the sanctions comply with the constitution. The head of Kraken suggested that the restrictions were a “hasty response” to the collapse of the Terra ecosystem, and regulators overreacted to protect users. He added that despite his stance, Kraken will block transactions with addresses associated with Tornado Cash.

Earlier, Uniswap protocol founder Hayden Adams took a similar stance. He said that sanctions against Tornado Cash are a threat to freedom of speech and privacy, and also called the arguments that privacy is only needed for illegal activities absurd.

Lawyers of Coin Center, a non-profit crypto policy think tank, are preparing to challenge the US authorities’ decision to ban Tornado Cash in court. The developers of the anonymous cryptocurrency Zcash from ECC and Stefan George, co-founder of Gnosis Chain, an Ethereum sidechain also opposed it. The mixer’s creator himself, Alexey Pertsev, was detained by Dutch authorities on August 12 on suspicion of involvement in money laundering. This information was confirmed by his wife Ksenia Malik to The Block.

What is known about Kraken? The exchange was registered in the United States in 2011. The founder is Jesse Powell. More than 120 digital and 7 fiat currencies are available for trading on the platform. Kraken has more than 8 million traders worldwide as clients. As of July 27, the daily trading volume was $518,6 million, according to aggregator CoinGecko.

For more details on what awaits DeFi projects after the sanctions against Tornado Cash, see GetBlock Magazine’s article.

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