Shark Tank star Kevin O’Leary backs sanctions on Tornado Cash

O’Leary calls for regulation; others warn against sanctioning technology.

Investor and Shark Tank star Kevin O’Leary, in an interview with Crypto Banter, stated the need to regulate cryptocurrency mixers such as Tornado Cash.

In his view, such apps hinder a substantial inflow of institutional capital into the digital asset industry.

O’Leary spoke out against the “crypto cowboys” in the industry. He says it needs a “rules-based environment” that would root out projects like Tornado Cash.

“I think we are approaching this stage. […] I want to participate in a regulated space where we can deploy billions of dollars,” the investor added.

According to O’Leary, the crypto industry will have to sacrifice the arrested Tornado Cash developer for the sake of some stability. Media reports identify him as the co-founder of the service, Alexey Pertsev.

Many industry figures did not share the stance. Among them is Coinbase CEO Brian Armstrong.

“Sanctioning a technology (as opposed to an individual or entity) seems like a bad precedent to me, and it should probably be challenged. Could have many downstream unintended consequences.” — Brian Armstrong

Armstrong also added that the trading platform under his leadership will always follow the law.

For what Tornado Cash is and how it works, read the educational cards ForkLog.

As reported, on August 8 the U.S. authorities added to the sanctions list the mixer site, along with related cryptocurrency addresses. According to OFAC, since 2019 Tornado Cash has laundered at least $7 billion.

Subsequently Circle added to the blacklist USDC wallet addresses after the sanctions. Infrastructure platforms Infura and Alchemy restricted RPC calls to Tornado Cash.

The decentralized derivatives exchange dYdX blocked user accounts that had previously interacted with the mixing service.

Following the sanctions, Tornado Cash fell by 15% in assets.

Tornado DAO participants urged the community to hire a team of lawyers to challenge the sanctions in court.

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