Tornado Cash Dev Facing Dutch Charges to Question Chainalysis Data Alleging Criminal Links

Lawyers for the privacy protocol developer facing money laundering charges in the Netherlands have disputed the evidence purporting to prove links to criminal money.

AccessTimeIconMay 24, 2023 at 11:42 a.m. UTC
Updated May 24, 2023 at 2:44 p.m. UTC

‘S HERTOGENBOSCH, the Netherlands – Tornado Cash developer Alexey Pertsev will be allowed to cross-question blockchain analytics company Chainalysis as he seeks to clear his name of money laundering charges, a Dutch court ruled on Wednesday.

Pertsev was arrested and detained on the orders of Dutch financial crime enforcers FIOD in August of last year, just days after the privacy protocol was sanctioned by the U.S. Treasury’s Office of Foreign Assets Control (OFAC).

OFAC has said Tornado Cash was used by North Korean hackers to process and obscure the source of funds for the regime, but Pertsev’s case has drawn protest from online rights activists who see it as a threat to open-source coding and online privacy.

Pertsev’s lawyer Keith Cheng told CoinDesk outside the courtroom that he was “happy” the court had allowed him to directly ask Chainalysis in writing about its methods.

“You're not going to have a hamburger analyzed at the laboratory… I say let's go to the meat factory,” Cheng said. “Just ask them what the ingredients are.”

FIOD explanations had proved technically unsatisfactory, such as its citing of the existence of “user agents” that don’t exist on the Ethereum blockchain, Cheng said.

Pertsev, who in April was freed to await trial from his home near Amsterdam, has denied charges of money laundering. But, with a further hearing set for September, his case now looks set to drag on into 2024.

On Saturday, Tornado Cash was the subject of an apparently malicious attack that allowed a hacker or group of hackers to seize control of the protocol, causing its TORN token to plunge.

Chainalysis did not immediately respond to a request for comment.

Edited by Sandali Handagama.


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Jack Schickler

Jack Schickler was a CoinDesk reporter focused on crypto regulations, based in Brussels, Belgium. He doesn’t own any crypto.