Jesse Powell, CEO of cryptocurrency exchange Kraken, criticized the government’s sanctions against Tornado Cash, calling it a “hurried” response. In an August 16 interview with Bloomberg Technology, Powell said the regulatory sanctions were not well thought out, adding that it was a “blind response” to protect investors after the Terra (LUNA) crash.
According to Powell, The Tornado Cash service can be equated with freedom of expression and questioned whether sanctions would survive a constitutional hurdle. “Transparency is when people can assess for themselves what is going on,” Powell said. It’s like a ‘blind reaction’ to the UST and LUNA collapse. Regulators are overreacting to protect investors.” made the statement.
Will Kraken Comply With Sanctions?
Despite the sanctions, Powell stated that despite this Kraken will block transactions from addresses linked to Tornado Cash.
“We will prohibit withdrawals from any Tornado-related address and possibly freeze all funds from a Tornado address,” Powell said.
Powell said individuals have a “right to privacy,” an element that the government has removed with its actions in Tornado. This came after the Treasury imposed sanctions on Tornado Cash. Powell accused the platform of failing to establish effective anti-money laundering rules.
“The Treasury is sanctioning Tornado Cash, which launders the proceeds of cybercrime, including those committed against victims in the United States,” the Treasury said in a statement. Expressions were used. A new study has revealed that Tornado Cash received 75 percent of funds laundered in Ethereum.
A section of the community stated that Kwon is free, but the Tornado Cash developer was arrested for creating code while trying to increase privacy. It can be argued that the Terra collapse has accelerated the moves to enact regulations to protect investors.