Skip to main content

Chainalysis Chief Scientist: Tornado Cash left a gap

 


Tornado Cash left a hole that fledgling blenders are now trying to plug after the US Treasury sanctioned and banned the blenders.


The sanctions against crypto mixer Tornado Cash have left a void for illegal mixers. However, the chief scientist at Chainalysis believes that more time will be needed before the full impact can be seen.


During a demo of Chainalysis' recently launched blockchain analytics platform Storylilne, Cointelegraph chatted to Chainalysis' chief scientist Jacon Illum and country manager for Australia and New Zealand Todd Lenfield about the impact of the tornado cash ban.


Illum said that while the mixer is still being used to some extent, more time is needed to see what happens and how the world reacts to the designation. He added that where the crypto mixer has gone, people are trying to figure out what to do.


“People are becoming more cautious in this area and unsure how to interact with Tornado Cash. We've seen deposits into services offering similar activities drop, at least temporarily, because people are measuring like, 'What does this mean for me?' ”


But where others see obstacles, some others see opportunities. Illum said that a number of so-called "junior mixers" have come into the world trying to capitalize on the void left by Tornado Cash.


A report by blockchain security firm SlowMist in August shows that 74.6% of stolen funds on the Ethereum network in the first half of 2022 were sent to Tornado Cash, about 300,000 ETH, around $380 million.


Data from Chainalysis shows that the 30-day moving average of the total daily value crypto mixers receive hit a new all-time high of $51.8 million in April.


"If the liquidity isn't there, you're effectively drying up a lot of capacity [of a blender]."


Lenfield added:


"Finding places where there is liquidity when it's highly visible after things like the OFAC sanctioning of Tornado Cash is a very interesting area to keep an eye on, I think."


Tornado Cash was sanctioned by the US Treasury Department on August 8, meaning any US citizen or entity using the blender may be subject to criminal or civil penalties. Over 40 cryptocurrency addresses allegedly linked to Tornado Cash have been added to the OFfice of Foreign Asset Control (OFAC) list of Specially Designated Nationals.


When asked about law enforcement's ability to deal with crypto-related crime, Illum mentioned that one of the biggest law enforcement gaps right now is blockchain-related training.


“As [blockchain] is increasingly adopted, there are more people who need to be exposed to crypto, which also means there are more agents or law enforcement officials who need to be exposed to crypto as well.”


Lenfield said authorities are beginning to build capabilities around cryptocurrencies, citing the Australian Federal Police (AFP)'s recent establishment of a cryptocurrency unit focused on monitoring crypto transactions.


"It's active in their minds, they set goals and they're working on it...but like in any aspect, there's that learning curve to get them there, but there's 100% visibility and development in that space through those agencies."


In early September, the Chainalysis Crypto Incident Response team helped law enforcement recover $30 million worth of cryptocurrency stolen in the Ronin Bridge hack by the North Korea-affiliated Lazarus Group, which used Tornado Cash to launder stolen assets.

My Top Picks
Honeygain - Passive earner that pays in BTC or PayPal
MandalaExchange -The Best no KYC crypto Exchange! 
BetFury - Play And Earn BFG for daily Bitcoin and ETH dividends!
Pipeflare - Faucet that pays in ZCash and Matic, Games pay in DAI
Womplay - Mobile dApp gaming platform that rewards in EOS and Bitcoin
Cointiply - The #1 Crypto Earning Site
Torum - Join the latest Social Network and earn TRM for Free! 
LiteCoinPay - The #1 FaucetPay earner for Litecoin 
LBRY/Odysee - YouTube Alternative that lets you earn Money by viewing videos!
FaucetPay - The #1 Microwallet Platform
FREEBTC - The #1 FaucetPay earner for Satoshi's
FaucetCrypto - An earning/faucet site that pays out instantly
FireFaucet - An earning site that pays better for some than Cointiply
DogeFaucet - Dogecoin Faucet
xFaucet - BTC, ETH, LTC, Doge, Dash, Tron, DGB, BCH, BNB, ZEC, FEY - Claim every 5 minutes
Konstantinova - BTC, ETH, LTC, Doge, Dash, Tron, DGB, BNB, ZEC, USDT, FEY, 25 Claims Daily

Comments

Post a Comment

Popular posts from this blog

From offchain to offchain: Statechains meets Lightning

  Without a doubt, the most significant off-chain Bitcoin solution is the Lightning network. But in its wake, the statechain has emerged as an intriguing replacement. There is currently a proposal to link the two offchain networks. From an ocean, for example, you can see sunbeams glistening in the water, waves rippling, and possibly a jellyfish drifting toward the light. But you only see a small portion of it. The distance from the sea's surface to its bottom is hundreds of meters. It has dozens of different fish species swimming in it, crabs and starfish crawling on the bottom, shells clinging to rocks, and sea plants climbing up. A completely new world starts where your gaze diverges. You can picture a blockchain like Bitcoin, just like the sea. What you see on the outside is only a small portion of what is actually there; the set of UTXOs (coins) and transaction history that full nodes store are just the beginning of a much larger world. It's the plan, at least. With Bitcoin
Post a Comment
Read more

MSP Recovery and Tokenology aim to optimize healthcare with the help of Polygon

  MSP Recovery LLC, a Miami, US-based healthcare provider with an estimated enterprise value of $32.6 billion, is partnering with Web3 company Tokenology to jointly launch a new blockchain platform called Lifechain. Lifechain wants to leverage the verifiable and transparent nature of blockchain technology to aggregate medical care claims, medical expense reports and patient data and streamline their processing. For this purpose, MSP Recovery launched its own LifeWallet in January, which already has 1 million users. In addition to the wallet and blockchain platform, an associated crypto token called LifeCoin is also used. The press release explains that the primary purpose of the system is to enable secondary healthcare providers to more effectively bill health insurance companies for their costs. “The number of medical claims tokenized going forward will surpass $50 million per day by 2024. For this we need scalability, security and sustainability, which we have only found with Polygon
Post a Comment
Read more

British financial regulator criticizes cooperation between Binance and Paysafe

  The British financial regulator FCA has expressed concerns about the partnership between market-leading crypto exchange Binance and payment service provider Paysafe. As the British regulator complains, the partnership gives Binance access to the influential British payment network Faster Payments Service (FPS), from which the crypto exchange was previously cut off. Last June, the FCA ordered Binance to stop all business activities in Great Britain. As a result, prominent banks such as Barclays have terminated their cooperation with the leading crypto trading platform . Through the cooperation with Paysafe, Binance can now again offer deposits in British pounds sterling and transactions within the European Payments Area (SEPA). However, this fact is a thorn in the side of the FCA, as it classifies the crypto exchange as a “considerable risk factor”. However, the financial regulator sees little room for maneuver to counteract this, as the Financial Times reports . “ Paysafe understands
Post a Comment
Read more