The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has formally removed Tornado Cash and its associated contract addresses from the Specially Designated Nationals (SDN) list, ending the sanctions regime imposed on the Ethereum-based privacy protocol since August 2022. The delisting, announced in an OFAC “recent actions” update on March 21, 2025, reverses measures that had barred U.S. persons and compliant intermediaries from interacting with dozens of Tornado Cash smart contract addresses and required any related property or interests in property under U.S. jurisdiction to be blocked. According to legal analyses of the action, Treasury told a federal court that, in light of the removal, the underlying legal challenge to the sanctions was now “moot.” This policy shift follows a key November 2024 decision by the U.S. Court of Appeals for the Fifth Circuit in Van Loon v. Department of the Treasury, which held that Tornado Cash’s immutable smart contracts are not “property” of a foreign person or entity under the International Emergency Economic Powers Act (IEEPA) and therefore could not lawfully be blocked by OFAC. The court concluded that OFAC exceeded its statutory authority by treating autonomous, open-source smart contract code as a sanctionable entity, a ruling that narrowed the agency’s reach over decentralized software infrastructure. Legal practitioners view Treasury’s withdrawal of the Tornado Cash designations as a significant precedent for how U.S. sanctions law applies to decentralized, non-custodial crypto protocols and for the limits of executive authority over open-source code. While the delisting reduces regulatory risk for interacting with Tornado Cash contracts going forward, U.S. authorities have emphasized that sanctions and criminal enforcement remain available against individuals, mixer operators, and other intermediaries who facilitate money laundering or support sanctioned actors.

AI-generated background, compiled from web sources — not editorial content.

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