Tornado Cash can be legitimately sanctioned as an entity under the International Emergency Economic Powers Act, according to U.S. District Judge Robert Pitman’s Thursday ruling. Pitman determined that the smart contracts used by Tornado Cash fall under the regulatory criteria of “property” subject to punishment.
Six Tornado Cash customers contested the legality of the company’s punishments in May. They claimed that the government-imposed restrictions on expression violated consumers’ First Amendment freedoms. The court denied the claim because there was no proof that the government’s actions had restricted their right to free speech.
Paul Grewal, the chief legal officer of Coinbase Global, entered the discussion on Friday. He stated on X, formerly Twitter, that despite the court ruling against the Tornado Cash plaintiffs, the cryptocurrency exchange will continue to support their claims.
