Tag: privacy

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Tornado Cash And Crypto Mixing Today: An Interview With DEF’s Amanda Tuminelli

for staff: tornado cash

In Congress, crypto mixing and its privacy-enhancing use of blockchain technology has been a troubling innovation for some Members. Case and point: crypto mixer Tornado Cash has been front-and-center in illicit finance deliberations within the U.S. government and was sanctioned in 2022 by U.S. Treasury.

Last Friday, blockchain tipsheet sat down with Amanda Tuminelli, Chief Legal Officer of decentralized finance advocacy firm DeFi Education Fund (DEF). We discussed both the latest and the “basics” in crypto mixing as well as the Department of Justice’s indictment in August 2023 of Tornado Cash software developers Roman Storm and Roman Seminov.

Roman Storm is currently in custody and his case has been delayed until later in the year in the Southern District of New York. Roman Seminov remains at large.

Also, last October, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) announced a Notice of Proposed Rule Making (NPRM) – see it – that identified crypto mixer transactions as a source of money laundering. DeFi Education responded with a formal comment (PDF).

With lawmakers and their staffs in mind, blockchain tipsheet’s interview with Ms. Tuminelli covered:

    • why crypto mixers are controversial
    • the lawful purpose of mixers
    • balancing AML regimes and mixers
    • crypto wallets and identifiers
    • overview on indictment of Storm and Seminov
    • Dutch court convicts Tornado Cash developer Alexei Pertsez
    • scenarios pending U.S. court decisions
    • unlicensed money transmitting
    • crypto mixing 5-10 years from now

The transcript has been lightly edited for clarity.

blockchain tipsheet: Why have crypto mixers become controversial?

Amanda Tuminelli: I think that many lawmakers are concerned that “mixing” automatically means unlawful conduct or a national security concern. And it has become fraught with national security issues because of the DPRK (North Korea) using Tornado Cash or the allegations that various terrorist groups are using mixing services in order to fund their activities. I think that is happening. And we absolutely are not here to support that in any way.

But, there is a disproportionate focus on those groups using mixers. And I think their focus should be more properly on the technology: what is mixing and what is it really going on under the hood, and who in the mixing tech stack is the appropriate person to regulate. Continue reading “Tornado Cash And Crypto Mixing Today: An Interview With DEF’s Amanda Tuminelli”

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The New ‘American Data Privacy and Protection Act’ and Blockchain Technology

American Data Privacy and Protection Act

To be clear – there is no mention of blockchain technology and cryptocurrency in the new American Data Privacy and Protection Act (ADPPA). But, with its introduction, it may raise the question for some of when/where privacy can be a part of the blockchain discussion.

A track of content at last Saturday’s crypto conference Consensus 2022 in Austin, Texas said it “all” with its title: “Can We Solve Privacy?”

Later in the day, Carole House, Director for Cybersecurity and Secure Digital Innovation for the White House National Security Council, told the audience she is hopeful that one day uniform KYC AML (Know-Your-Customer Anti-Money-Laundering) crypto rules can be applied globally for financial transactions – an application at the opposite end of privacy. Yet, she also indicated that consumer privacy is a conundrum that needs to be solved for today’s blockchain tech.

Similar to recent blockchain policy efforts such as the Responsible Financial Innovation Act in the Senate and the Digital Commodity Exchange Act in the House, creating a “a strong national framework” – and this time for a national government data privacy policy – is taking centerstage this week with hearings for the ADPPA.

The bill was released as a draft on June 3:
Continue reading “The New ‘American Data Privacy and Protection Act’ and Blockchain Technology”

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The National Treasure: Our Data

Eye of Providence

What if there was privacy, but there was still identification -of everything?

SafeGraph CEO Auren Hoffman’s new treatise entitled, “It’s Our Moral Obligation to Make Data More Accessible,” sees a world of opportunity ahead if access to data troves can be unleashed to the innovators of today. Read it here.

As Hoffman begins to make his case, the Silicon Valley entrepreneur twists the knife of “morality” into the reader’s gut:

“We have a MORAL OBLIGATION to get this data into the hands of millions of innovators. Not doing so is a true failing of society. This data can save hundreds of millions of lives and help all of humanity … which means not using it hastens the death of hundreds of millions of people.”

No doubt privacy advocates and related special interests will initially convulse at the thought of opening data stores to hoodied entrepreneurs, well-meaning or not. But after being at the front lines of the digital data revolution, Hoffman has put his reputation on the line and seems ready to fight.

It should also be noted that the treatise fits well within his current company’s mission “towards making our vision (to democratize access to data) a reality.”

Continue reading “The National Treasure: Our Data”

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Decentralization and Privacy Can Co-Exist on the Blockchain Says Privy CEO Stern

Henri Stern of Privy

With data flooding today’s blockchain infrastructure, speed and scalability have become an increasing bottleneck. Nevertheless, user privacy is a part of this equation and in the notoriously transparent world of blockchain, what’s a developer to do?

At ETH Denver 2022, Privy CEO Henri Stern – formerly of Filecoin – showed his hand on where his company will fit in as it looks to help blockchain developers thread the needle and maintain user privacy while continuing to offer improved decentralization and better user ownership.

For Privy, its API offering starts with effective management of user data off-chain by addressing compliance and infrastructure requirements. The company hopes that easy access to its API will somewhat relieve developer concern about the thorny thicket of user privacy and let them concentrate on their blockchain product and on chain mechanics.

Continue reading “Decentralization and Privacy Can Co-Exist on the Blockchain Says Privy CEO Stern”