Coinbase Warns Legal Battle Over Tornado Cash Far From Over

Coinbase has asserted that the legal battle surrounding Tornado Cash is far from over, despite the U.S. Treasury's recent decision to delist the cryptocurrency mixer from its Specially Designated Nationals (SDN) list. The delisting, which occurred on March 21, removed Tornado Cash and its associated smart contract addresses from the list, a move that was seen as a significant development in the ongoing legal dispute.

Coinbase's chief legal officer, Paul Grewal, has argued that the removal of sanctions does not automatically end the legal case. He warns that without a final court judgment, there is no guarantee that Tornado Cash will not face future restrictions or re-sanctioning. This perspective underscores the ongoing uncertainty and potential for further legal action, even as the immediate sanctions have been lifted.

The U.S. Treasury's decision to delist Tornado Cash was met with mixed reactions. While some viewed it as a victory for privacy advocates, others, including Grewal, saw it as an incomplete resolution. The Treasury's position, as stated in a court filing, is that the matter is now moot and that a final judgment is unnecessary since the issue has been resolved. However, Grewal contends that this stance overlooks the broader implications and potential for future legal challenges.

Coinbase has been a vocal supporter of Tornado Cash users throughout the lawsuit, providing legal and financial backing. Grewal's comments reflect the company's commitment to ensuring that the legal case is fully resolved, rather than simply accepting the delisting as a final resolution. He argues that a final ruling is needed to prevent further attacks on the protocol and to provide clarity for users and developers.

The delisting of Tornado Cash from the SDN list is a significant development, but it does not mark the end of the legal battle. Grewal's warnings highlight the ongoing uncertainty and the potential for future legal action. As the case continues to unfold, it remains to be seen how the legal landscape will evolve and what impact this will have on the broader cryptocurrency community.

Meanwhile, the founders of Tornado Cash are still facing legal challenges. Roman Storm is set to face trial next month, while Roman Semenov remains on the FBI's most wanted list. The crypto world continues to watch these developments closely, as the outcome could set important precedents for the regulation and use of cryptocurrency mixers.